India, World Bank sign $100m agreement to suport green growth in HP
New Delhi, June 11, 2014
The Government of India, the Government of Himachal Pradesh (GoHP), and the World Bank today signed a $100 million development policy loan (DPL) agreement to help Himachal Pradesh (HP), a mountain state richly endowed with natural resources, move towards a more environmentally sustainable model of economic growth.
The project was approved by the World Bank’s Board of Executive Directors on May 16, a press release from the World Bank said here today.
This operation is the second DPL aimed at helping the state manage its natural resources across its key engines of growth – energy, industry and tourism – in a manner that ensures that growth is inclusive and sustainable in Himachal Pradesh. It will help HP bring in better policies and practices to guide the development of sustainable hydropower; adapt and mitigate the effects of climate change; empower local communities to conserve their watersheds better; promote cleaner methods of industrial production; promote environmentally sustainable tourism; and integrate GIS in decision making.
Efforts to achieve these goals were initiated under DPL I. DPL II will help the government ensure its effective implementation and completion.
The first DPL of $100 million was approved in September 2012 and funded out of World Bank’s International Bank for Reconstruction and Development (IBRD) resources. The second operation, signed today will be financed by the Clean Technology Fund (CTF), which provides developing countries with positive incentives to scale up the demonstration, deployment, and transfer of technologies with a high potential for long-term reduction in greenhouse gas (GHG) emissions. The CTF financing followed the endorsement in November 2011 of India’s Investment Plan by the CTF Trust Fund Committee. Both IBRD and CTF offer concessional terms of financing.
The loan agreement for the CTF funded Second Inclusive Green Growth and Sustainable Development DPL in Himachal Pradesh was signed by Ms Usha Titus, Joint Secretary (Multilateral Institutions), Department of Economic Affairs, Ministry of Finance, on behalf of the Government of India; Mr Shrikant Baldi, Principal Secretary (Finance), on behalf of the Government of Himachal Pradesh; and Mr Onno Ruhl, World Bank Country Director in India, on behalf of the World Bank.
“Under DPL I, Himachal Pradesh has already introduced a range of initiatives designed to make its growth path environmentally sustainable. DPL II will ensure that the initiatives undertaken in the first operation is further strengthened and sustained,” said Ms Titus.
Today Himachal Pradesh (HP) provides economically valuable environmental services for much of the country. The state is home to three major river basins, and it serves as a watershed that is critical to the livelihoods of more than 200 million people in Haryana, Punjab, Uttar Pradesh and Rajasthan. It is also one of the country’s main sources of clean energy, generating hydropower that can help alleviate electricity shortages in much of North India. The forests of HP also act as an important carbon sink and are known to be global biodiversity hotspots, the release added.