ADB to give $300 m loan for upgrading state highways in Madhya Pradesh
New Delhi, June 15, 2011
The Asian Development Bank (ADB) will provide a $ 300 million loan for strengthening state highways in Madhya Pradesh.
This will be ADB's third intervention in the state in the transportation sector, an official press release said.
The signatories to the loan agreement were Mr Venu Rajamony, Joint Secretary (Multilateral Institutions), Department of Economic Affairs, Ministry of Finance, on behalf of the Government of India, and Mr Prodyut Dutt, Officer-in-Charge, ADB's India Resident Mission.
The project agreement was signed by Mr K.K. Singh, Principal Secretary, on behalf of the Government of Madhya Pradesh and Mr Prodyut Dutt of ADB.
The release said the loan would help upgrade about 1,000 km. of state highways in the eastern and west central parts of the state. As part of the loan package, ADB is additionally providing technical assistance/grant worth $1 million to support road safety and private sector participation in state highway development and maintenance.
Madhya Pradesh Rural Development Corporation (MPRDC) has already been implementing the first two ADB assisted projects under Loan 1959-IND: Madhya Pradesh State Roads Sector Development Program and Loan 2330-IND: Madhya Pradesh State Roads Sector Project II. The second project approved in 2007, is scheduled to end in December 2011.
The new loan will continue ADB’s support for the development of the entire highway network and capacity enhancement of MPRDC, particularly in those areas which were not covered in the previous two loans, to build upon the success of the organization as an implementation agency. With completion of this project, the entire state highway network of Madhya Pradesh will have been upgraded, the release said.
Mr Rajamony said the Government emphasizes investment for inclusive and sustainable growth through innovative financing modalities, including Public Private Partnership (PPP). Madhya Pradesh has recorded impressive growth performance of more than 7% per annum since fiscal year 2005, deriving substantially from efficient infrastructure development programs. He said that the project will help sustain high economic growth and reduce poverty in the state.
Mr Dutt said that, under the Country Partnership Strategy (2009-2012), ADB supports road sector development as a core infrastructure operation to facilitate sustainable economic growth in India. As a long-standing development partner for Madhya Pradesh, as of today, ADB has approved 15 loans amounting to $2.57 billion covering the power, urban, state road, and rural road sectors. ADB has also helped the state through a public resource management loan, he added.