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WB to grant $12 bn for infrastructure

RUN-UP TO THE BUDGET

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Rupesh Janve New Delhi
Last Updated : Feb 26 2013 | 12:24 AM IST
The World Bank proposes to lend India $12 billion over three years, beginning this year, for infrastructure, human resource development and rural development.
 
The money will be given through the International Bank for Reconstruction and Development (IBRD) and International Development Association (IDA). India has estimated that it will need nearly $320 billion over the next five years
 
World Bank vice president for the South Asia region, Praful Patel said: "The bank is working in close partnership with the central and state governments, and aligning its strategies with the country's development agenda. This will help the government lay emphasis on investing in people through better health and education, and also promote private sector-led growth to achieve the country's development goals."
 
India is one of the oldest members of the World Bank, having joined the institution in 1944. New lending to the country in the financial year July 2005 to June 2006 was $1.416 billion.
 
Of this, $500 million was from the IDA, the World Bank's concessional lending arm, and $916 million from the IBRD. At the end of June 2006, the bank group had 56 active projects, with a net commitment of about $11.3 billion.
 
Patel added that the money would have to be repaid in 17 years, including a grace period of five years.
 
"The interest on the amount will turn out to be very low, at nearly 2.5 per cent per year," he said. At present, the Libor rate of the IDA is 5.3 per cent.
 
Earlier, the bank had made a four-year country strategy for 2005-2008 for India, focusing on lending for infrastructure, human development, and improving rural livelihoods.
 
At the end of a two-day international conference on meeting India's infrastructure needs, Patel said: "Public-private-partnerships have to play a much bigger role in meeting India's infrastructure needs. Despite recent increases, the investment in private infrastructure projects in India has only averaged around 1 per cent of GDP over the last 5 years, while countries like Malaysia, Chile and Brazil have invested in the range of 2-3% of GDP over the last 15 years".
 
The conference was jointly organised by the Centre, the World Bank and the International Finance Corporation, the private sector arm of the World Bank Group, in collaboration with Public Private Infrastructure Advisory Facility and Infrastructure Development Finance Company.

 
 

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First Published: Feb 07 2007 | 12:00 AM IST

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