ADB, India Sign $84 Million Loan to Improve Urban Services in 2 Bihar Towns

•  The Asian Development Bank (ADB) and the Government of India today signed a $84 million loan that will finance water supply improvements and expansion in Bhagalpur and Gaya towns in the state of Bihar.
• The tranche 2 loan is part of the $200 million multitranche financing facility (MFF) for the Bihar Urban Development Investment Program that was approved by the ADB Board of Directors in 2012 to provide sustainable urban infrastructure and services in four towns in Bihar—Bhagalpur, Gaya, Darbhanga, and Muzaffarpur.

About ADB:

• The Asian Development Bank was conceived in the early 1960s as a financial institution that would be Asian in character and foster economic growth and cooperation in one of the poorest regions in the world.
• A resolution passed at the first Ministerial Conference on Asian Economic Cooperation held by the United Nations Economic Commission for Asia and the Far East in 1963 set that vision on the way to becoming reality.
• The Philippines capital of Manila was chosen to host the new institution, which opened on 19 December 1966, with 31 members that came together to serve a predominantly agricultural region. Takeshi Watanabe was ADB's first President.
• During the 1960s, ADB focused much of its assistance on food production and rural development

Analysis:

• Asia moved beyond the economic crisis to emerge as a new engine of global growth , when the region’s gross domestic product increased by 9%.
• While the speed and strength of its economic recovery surprised many, the region still faced daunting challenges and remained home to two thirds of the world’s poor and a growing problem of inequality. This increasing gap between the rich and poor focused ADB on the need to promote inclusive growth in the region.
• India has been a founding member of the Asian Development Bank (ADB) since its establishment in 1966.
• ADB commenced its operations in the country in 1986, during the initial stages of India’s economic reforms. While continuing to support India’s endeavors to reduce poverty through infrastructure-led growth, ADB’s India program has developed and matured over the years in terms of its sector, geographic, and thematic coverage, in line with the Government of India’s evolving priorities and increasing focus on inclusive and sustainable growth.
• Besides continuing its support for core infrastructure sectors such as energy, transport, and urban services, ADB is now engaged in innovations in infrastructure finance and improving water resources management, agribusiness infrastructure development, and skills development. In line with the government’s guiding principle of “Innovation Impulse with Investment,” ADB has been integrating innovations and regional best practices into project design and implementation.
• India is now ADB’s fourth largest shareholder. Since the start of its lending operations in 1986, ADB has approved 210 loans amounting to $31.5 billion, $173.8 million for 10 grants, and $262 million for 348 technical assistance projects as of 31 December 2013.

By: Vishal