Praising New Delhi for improving the efficiency of project implementation, the World Bank looks set to increase its assistance to India for several large projects in the pipeline.
I expect to see increases in the total IBRD (International Bank for Reconstruction and Development) amount in the future because of projects in the pipeline, said one official who did not wish to be named. He was speaking in the context of the latest assessment of World Bank project performance worldwide, including South Asia.
One huge project about to be approved is a $500 million coal sector project. But the official said he did not foresee power sector projects in the near future although India has a good line of projects in the pipeline.
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India was the largest borrower in the South Asia region from the World Bank in fiscal year 1997, which ended on June 30. Bank lending commitments to India reached $1.5 billion for ten projects, with International Development Association (IDA) credits accounting for $903 million and IBRD loans for the remainder.
This was followed by Bangladesh ($321 million for three IDA projects), Pakistan ($84.8 million for two IDA projects), Sri Lanka ($57.8 million for three IDA projects) and Nepal ($18.3 million for one IDA project). No lending was provided to Afghanistan, Bhutan and the Maldives.
While disbursements increased sharply in South Asia, the lending went down by almost one billion dollars over the previous two years. The total lending to South Asia in the 1997 fiscal year was a little over two billion dollars compared to over three billion in both 1996 and 1995.
What is important this year is that the disbursements were up $400 million out of 2.6 billion is a very large amount, asserted Manuel Penalver, senior operations adviser for South Asia. This meant that the undisbursed amount is also on its way down, a standing complaint with projects in South Asia, especially India, in the past.
The bottom line is that projects are being implemented. What matters is what happens on the ground, Penalver told IANS.
He saidthat this showed a much greater attention by both the governments of the region and the World Bank to project preparation and not a hurried attempt to meet fiscal year numbers.
The impact in the future would be faster disbursements and fewer cancellations, Penalver noted. He conceded that careful attention and seriousness on the part of both the Indian government and the Bank to issues of resettlement saves time and improves results.
While initial time and money invested may be more, he said, it paid off in the end, with more efficiency and savings. Otherwise they are going to come back to haunt the implementation, he said about resettlement issues which have plagued many projects in the past, especially the notable multi-billion dollar Narmada Dam project.
Penalver also noted that the World Bank was now working much more closely with the various states in India. In a sense it multiplies the demand its almost like dealing with twenty countries, he said. New lending commitments from the World Bank to developing countries totalled $19.1 billion in fiscal year 1997. This figure includes both the market-rate loans made by the IBRD and the concessional loans made to the worlds poorest countries through the IDA. The total compares with $21.4 billion in fiscal year 1996 and $22.5 billion in fiscal year 1995.
IBRD loan commitments in 1997 amounted to $14.5 billion for 141 projects; $4.6 billion in IDA credits supported 100 projects. The respective totals for fiscal year 1996 were $14.5 billion for 129 IBRD projects and $6.9 billion for 127 IDA projects.
IBRD/IDA combined gross disbursements at the end of fiscal year 1997 rose to nearly $20 billion, up from $19.3 billion in the previous year. IBRD gross disbursements totalled $14 billion, compared with $13.4 billion in fiscal 1996; IDA gross disbursements were $6 billion, compared with $5.9 billion in the previous fiscal year. Commenting on the fiscal year 1997 results, Gautam Kaji, World Bank Managing Director for Operations, said, We are retooling our processes, we have taken a sharp look at the lending pipeline, so lending approvals have fallen as a consequence. This was to be expected.