ADB pledges $12 billion in support of new flagship initiatives in India

Asian Development Bank (ADB) President Mr. Takehiko Nakao met with India’s Prime Minister Mr. Narendra Modi and pledged to support the government’s new flagship initiatives led by the Prime Minister. 

The Prime Minister and Mr. Nakao discussed how to further enhance the partnership in areas such as the promotion of new technologies and innovation, renewable energy, solar-pump irrigation, electric vehicle and battery, fintech, sustainable tourism, and the recycling of plastics.

At his meeting with the Prime Minister, Mr. Nakao commended the government’s vision to make India a $5 trillion economy during Mr. Modi’s second term, and reaffirmed ADB’s commitment to helping bolster the country’s inclusive growth and rapid economic transformation to achieve this vision.

“India is one of the fastest-growing economies in Asia and the Pacific, maintaining a growth rate of about 7.5% on average in the last 5 years. ADB expects the country’s growth in 2019 at 7.0% and in 2020 at 7.2%, despite downside risks in the global economy,” said Mr. Nakao at his meetings with the Indian leadership. “The government needs to maintain prudent macroeconomic management, sustain its reform efforts, enhance industrial competitiveness and job creation, and rejuvenate the rural economy.”

ADB’s sovereign lending to India in 2018 reached a record $3.0 billion, in transport, urban, irrigation, skills development, and intermediary finance for public-private partnerships. Mr. Nakao said he appreciated the country’s speedier implementation of projects. He emphasized the bank’s commitment to catalyzing private sector investments and announced a $100 million investment in the National Investment and Infrastructure Fund. In May 2019, ADB made its single largest nonsovereign loan to date by committing $750 million to the Indian Railways Finance Corporation to support the electrification of existing railways tracks.

Mr. Nakao said ADB stands ready to commit more than $12 billion lending in the next three years, 2020–2022, averaging annually over $3 billion for sovereign operations and $1 billion for nonsovereign operations.

ADB’s sovereign and nonsovereign operations will focus on the government’s major initiatives, including (i) the Jal Jeevan Mission (extending drinking water for all, water conservation, and more crop per drop); (ii) the East Coast Economic Corridor program; (iii) promoting competitiveness of micro, small, and medium-sized enterprises by connecting to global value chains; (iv) supporting national road safety programs; and (v) constructing a rapid rail transit system to connect Delhi with neighboring satellite cities, starting from Delhi to Meerut. ADB will also expand assistance in secondary education and the universal health system.

Original source: ADB
Published on 29 August 2019