The aim of the loan is to help India to deal with the COVID-19 pandemic and represents the largest financial aid to India announced by any country so far, to tackle the COVID-19 crisis. The loan has an interest rate of 0.01% per annum and a repayment period of 15 years, including a four-year grace period.
The financial support will help to modernize Indian hospitals and undertake necessary reforms. The government in New Delhi plans to equip hospitals with ICUs and infection prevention and management facilities which India’s healthcare system currently suffers a lack of. According to government data, India has one of the world’s lowest levels of expenditure for its healthcare system – ranging from as low as 1% to 5% of GDP.
Underinvestment in the country’s public healthcare system poses a serious threat to the country’s COVID-19 containment strategy, particularly in rural areas but, thanks to the availability of digital technology, the Indian medical service is also planning to develop telemedicine to reach the inhabitants of the many outlying villages in the country.
Apart from the development assistance loan, Japan also plans to donate around US$95 million of grant aid within the framework of its Official Development Assistance scheme for India’s Economic and Social Development Program which is being implemented by the health ministry. The aid will help to purchase oxygen generators which are essential in the treatment of patients in a critical condition with COVID-19.
Whilst these measures have been taken to strengthen the Indian health care system in an effort to control the spread of the coronavirus, they may also help to stabilize the Indian economy which is struggling with the negative effects resulting from the pandemic.
According to The Lancet research, India is one of the countries most affected by the current pandemic, mainly because of its underfunded and poor public health system which differs in each Indian state. This forces millions of citizens – roughly 44% of families in rural areas and about 52% of families living in large cities – to use private healthcare services whose operations are largely unregulated.
More than 1 million cases have been detected in India in less than two weeks and on Sunday, September 14, the country experienced another record surge of 90,632 cases in just 24 hours with infections spreading mainly in smaller cities and in rural areas. India has recorded over 4,113,000 cases so far, a little less than Brazil, the second worst-hit country after the US, which has recorded 4,123,000 cases. The ministry also reported there had been 1,065 deaths on Sunday alone bringing the total of those dying from the virus in India to 70,626. Whilst the government has declared that more than 1 million people are being tested daily, the reported recovery rate is 77.2% and the fatality rate is around 1.73%.
Due to the serious crisis in India, the German government has also decided to provide the country with development aid and plans to send 330,000 coronavirus testing kits and 600,000 pieces of personal protective equipment worth a total of €15 million in the near future. As well as this, Germany’s Federal Ministry for Economic Cooperation and Development (BMZ) intends to offer India short-term loans worth €460 million.
Discover all funding opportunities for health projects in India on the DevelopmentAid platform.
