The World Bank has approved Rs 1616 crore (US$362 million) assistance for Orissa to improve the state’s road network and renovate the agricultural tank systems in the state.
While Rs 1070 crore is earmarked for Orissa State Road Project (OSRP), Rs 546 crore will be spent on Orissa Community Tank Management Project (OCTMP).
The sanction of the loan follows the detail negotiation of a team of senior state government officials with the World Bank officials in July this year in Washington.
Though Orissa has made a strong fiscal turnaround and its economic growth has accelerated, yet the state remains one of the poorest states in the country with nearly half of its 38 million people living below the poverty line.
With the assistance, the state government plans to improve a total of 906 kms of road including upgradation of 461 km road to two lane road with paved shoulder and reconstruction of the bridge on Bansadhara river near Gumuda.
The total cost of OSRP is estimated at Rs 1440 crore. The balance fund will be provided by the state government.
During the first phase of the project, 204 kms of road construction will be taken up which includes construction of 68 km Bhawanipatna-Khariar road, 95 km long Chandbali-Bhadrakh-Anandapur road and 41 km Berhampur-Taptapani road.
Similarly, in the second phase, the construction of 257 kms of road includingTaptapani-Raipanka road (68 km), Raipanka-JK Pur (83km) and Jagatpur-Chandabali (106km) will be taken up.
Since the quality of Orissa’s road network is considerably low compared to other states, OSRP aims to remove transport bottlenecks in transport corridors through better performance, safety, and capacity of priority roads.
Besides, it is expected to increase the role of the private sector in road infrastructure and assist the state government to establish an institutional and governance framework in the sector.
“This project will lead to a significant reduction in transport costs for businesses and households in project areas, and ultimately boost growth through a better investment climate that will help the state exploit its mining, industrial and tourism potential.” the World Bank said.
Similarly, the bank also sanctioned Rs 546 crore (US$112 million loan ) for the OCTMP. It is will renovate some 900 tanks with a potential to irrigate120,000 hectares of cultivable area spread across 29 districts of the state.
The project seeks to support improvements in production technologies and management practices and promote better market linkages. It will also strengthen community-based institutions, enabling them to assume greater responsibility for tank management.
Further, the project is expected to increase productivity in agriculture, livestock and fisheries, and promote more effective and sustainable management of tank systems.
The Rs 1070 crore loan for the Orissa State Road Project, from the International Bank for Reconstruction and Development (IBRD), has a 30 year maturity including 5-year grace period.
The US$56 million credit for the OCTMP from the International Development Association (IDA) carries a 0.75 percent service fee, a 10-year grace period and a maturity of 35 years.
The remaining US$56 million loan for the Orissa Community Tanks Management Project, from the International Bank for Reconstruction and Development (IBRD), has a 30 year maturity with a 5-year grace period.
