Japan to give US$ 3.45 Billion ODA loan to India to boost urban infrastructure

NEW DELHI: Japan has agreed to grant 375 Billion Yen (US$ 3.45 Billion) long-term loan for nine urban infrastructure projects including highways, metro trains, rail corridors, water supply, pollution abatement, Community-Based Forest Management, and Livelihoods Improvement in India.

To be returned in 30-40 years, this is the Official Development Assistance (ODA) provided by Japan to India through its agency the Japan International Cooperation Agency (JICA) on very easy interest rates.

On March 27, Suzuki Satoshi, Ambassador Extraordinary and Plenipotentiary of Japan to India, and Dr. C. S. Mohapatra, Additional Secretary, Department of Economic Affairs, Ministry of Finance, Government of India, exchanged notes concerning the provision of yen loan after JICA signed loan agreements with the Government of India in Delhi

According to JICA, the construction of dedicated freight railways in Gujarat, Rajasthan and Haryana to realize the Delhi-Mumbai Industrial Corridor (DMIC), the part of Dedicated Freight Corridor Project (Phase 1)(IV) earned maximum loan provision of up to 130 billion yen.  The distance traveled by vehicles will increase from 38,000 km to 250,000 km and the number of trains will increase from 33 to 222 in comparison with 2007.

Through responding to the increase in cargo transport demand and improving the efficiency of the logistics network, this project will contribute to economic development and improvement of the environmental conditions in the broad target areas.

JICA agreed to give loans up to 13.967 billion yen for the construction of the Ahmedabad Metro network dealing with chronic traffic congestion. This project is to provide a loan to the Government of India for the construction of two metro lines (North-South and East-West) in the Ahmedabad metropolitan area in Gujarat.

On the completion of this project, the travel time is likely to be reduced from approximately 70 minutes to approximately 40 minutes on the North-South Line, and approximately from 98 minutes to approximately 42 minutes on the East-West Line. This project is also expected to alleviate traffic congestion and traffic pollution in the metropolitan area dealing with the increasing transportation demand, thereby contributing to the promotion of the economic growth of India.

The setting up of the water supply facilities to ensure a safe and adequate supply of drinking water under the Madhya Pradesh Rural Water Supply Project attracted a loan provision of up to 55.470 billion yen.

This project aims at providing a loan to the Government of India to construct the water supply facilities in three northwestern districts of Madhya Pradesh.  The average daily water supply by the newly constructed waterworks facilities will be 96,634 m3 (East area) and 92,296 m3 (West area). Through this project for sustainable and safe waterworks services, it is expected to improve the sanitary condition and living environment of local residents.

Another project Mumbai Metro network tackling chronic traffic congestion under Mumbai Metro Line 3 Project (III) has a loan provision of up to 39.928 billion yen. This project is for the construction of a mass transit system with a total length of approximately 34 km in the Mumbai metropolitan area in Maharashtra. The number of trains will be 767 trains and transport volume will be 13,800,000 passenger-kilometers per day. As a result of this project, it is expected to reduce traffic congestion and pollution as well as strengthen industrial competitiveness for the economic development of the metropolitan area.

Construction of the maritime bridge road to improve connectivity in the Mumbai metropolitan area under the Mumbai Trans-Harbour Link Project (II) has a loan provision of up to 66.99 billion yen for the Mumbai Metropolitan Region Development Authority.

This project is for construction of the maritime bridge road in the Mumbai metropolitan area of Maharashtra to connect central Mumbai on the peninsula side to the Navi Mumbai area on the other side of the Gulf of Mumbai. The number of passengers on the targeted route will be approximately 46 million per year, and the travel time will be reduced from 61 minutes via the nearest detour route to 16 minutes, which is expected to contribute to the promotion of economic growth by improving connectivity to places such as Navi Mumbai, where urban development is being planned.

The project of constructing roads to improve connectivity in northeast India under the North East Road Network Connectivity Improvement Project (Phase 4) with a loan provision of up to 14.926 billion yen aims at providing a loan to the Government of India for the improvement of the national highway connecting Kailashahar to Kowai in Tripura as well as the construction of a new bypass in Kowai.

The average travel time of the target section will be reduced from approximately 205 minutes to approximately 103 minutes, which will lead to expanding the annual average daily traffic, the number of passengers, and the volume of freight. Thus, this project will improve the region’s connectivity with other regions, both within and outside the region and country, which is expected to contribute to promoting the economic development in this region.

The Tree-planting activities project to restore the forest area and improve the living environment of residents in Meghalaya under Project for Community-Based Forest Management and Livelihoods Improvement in Meghalaya has a loan provision of up to 10.397 billion yen.

This project is to provide a loan to the Government of India for implementing sustainable forest management, livelihood improvement activities and measures to strengthen the organizational structure of state government agencies in Meghalaya. The project is expected to improve the quality of forests in the area, including the planting of 22,500 hectares of new trees, and contribute to the improvement of local residents’ livelihoods through the improvement of the forest ecosystem in the state and the production of handicrafts made from local bamboos.

The project of restoration and enhancement of the ecosystem function in Gujarat under Project for Ecosystem Restoration in Gujarat has a loan provision of up to 13.757 billion yen, and is a short term loan for 14 years, unlike others that run between 30 and 40 years.

This project is to provide a loan to the Government of India for the creation of mangrove and windbreak forests; restoration of grasslands, forests, and wetlands; strengthening of human-animal conflict management systems; and strengthening of administrative systems in Gujarat. The project is expected to restore and strengthen the function of ecosystem services by measures including the planting of 12,200 hectares of new trees in coastal areas, which will solve socio-economic issues in the province, such as agricultural damage caused by salt damage.

The project of laying sewerage facilities to improve urban environmental problems in Nagpur under the project for Pollution Abatement of Nag River in Nagpur (Maharashtra), attracted a loan provision of up to 29.082 billion yen.

This project is to provide a loan to the Government of India for the construction of sewerage and sanitation facilities in the Nag River basin and its tributaries, such as the Piri River, running through Nagpur, Maharashtra. As a result of this project, the sewerage penetration rate in the target area is expected to reach 100%, which will improve river water quality and prevent pollution, thereby contributing to sustainable and inclusive growth.