$225 million World Bank loan for Andhra reforms
Thursday, 18 January 2007, 18:30 IST
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Washington: The World Bank has approved a $225 million loan/credit to India's fifth largest state Andhra Pradesh to support its ongoing program of fiscal, administrative and service delivery reforms aimed at boosting economic growth and reduce poverty. The $150 million International Bank for Reconstruction and Development (IBRD) loan component has 20 years to maturity including five years of grace period. The $75 million credit provided by the International Development Association (IDA), the World Bank's concessionary lending arm, has 35 years to maturity and a 10-year grace period. The third in a series of budget support operations, the program is designed to improve the state's investment climate, strengthen public expenditure and financial management practices, improve the quality of public service delivery in health, education and power sectors and help the government to better target anti-poverty programs through more effective monitoring and evaluation. "Andhra Pradesh has made impressive progress in all dimensions of development. Per capita income has risen, poverty has fallen considerably, and 95 percent of its primary school age children are in school," said Fayez Omar, senior manager, India Program and acting World Bank country director for India. "This operation will ensure continuity of the reform program and address a number of development challenges." The benefits from the project include greater investment and more job opportunities due to improvement in the state's investment climate, increased fiscal space for development spending through better public budget and financial management, and improved delivery of public services through better governance and effective targeting of programs. "The reform momentum in Andhra Pradesh continues to gather pace and is reflected in its improved development achievements," said Vinaya Swaroop, World Bank lead economist. "This project will also help the state in making the development process more inclusive, especially the poor living in rural areas."
Source: IANS
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