The Hindu : Japan gives Rs. 5,270 cr. soft loan to India

Online edition of India's National Newspaper
Thursday, Apr 01, 2004

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Japan gives Rs. 5,270 cr. soft loan to India

By Our Special Correspondent

NEW DELHI, MARCH 31. India today became the largest loan recipient from Japan when it received a Rs. 5,270-crore soft loan for eight infrastructure projects under the Official Development Assistance package.

With today's loan package, India has replaced China as Yen loan commitment to the country went up by a robust 12.37 per cent this year over the previous year's commitment, making fiscal 2003 a landmark year for the growing Japan-India development partnership.

The exchange of notes to formalise the agreement was concluded today in the Union Finance Ministry.

The notes were signed and exchanged by the Japanese Ambassador in India Yasukuni Enoki, and the Additional Secretary, Finance Ministry, S.G. Mankad.

The package covers eight mega projects including Delhi Metro's fifth phase (59 billion yen), Purulia Pumped Storage project in West Bengal (24 billion yen), Shauliganga hydro project in Uttaranchal (14 billion yen) and Meghalaya's Umiam hydro project (1.96 billion yen).

The loans would be provided by the Japan Bank for International Cooperation (JBIC) at a concessional rate of 1.3 per cent for 30 years.

The other projects that would receive Japanese funding are Rengali Irrigation, Kurnool-Cuddapah Canal, Bisalpur Jaipur Water Supply and Integrated Natural Resource Management and Poverty Reduction project of Haryana.

Later, Ambassador Enoki told presspersons while over the last decade Japan's overall loan budget had declined by about 50 per cent, the assistance to India had increased its share in the budget from around 12 per cent in 1993 to over 24 per cent in 2003 fiscal.

He said the main objective of Japanese loan assistance was to support India in establishing physical infrastructure to boost and sustain economic growth.

At the same time, Japanese assistance seeks to support India's efforts to alleviate poverty.

In keeping with these goals, the loan package strategically covers urban transportation, power, drinking water supply, irrigation and afforestation projects.

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