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LATEST NEWS UPDATES | World Bank approves $4.3b aid to India to fight poverty

World Bank approves $4.3b aid to India to fight poverty

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published Published on Mar 28, 2012   modified Modified on Mar 28, 2012

Source: PTI/IANS

The World Bank has announced $4.3 billion in financial aid to India through a new innovative and flexible financing arrangement to help the country fight poverty.

The arrangement, while facilitating a $4.3 billion increase in support to India, is designed to maintain International Bank for Reconstruction and Development's -- which is its lending arm -- net exposure within the limit of $17.5 billion established by it.

In a statement, the World Bank said the new arrangement will allow for special bonds to be issued by the World Bank and purchased by India, to offset additional planned lending.

This will enable India to continue accessing long-term, low-interest IBRD finance for development projects aimed at improving the lives of its people, one third of whom are yet to make their way out of poverty.

"Without taking this action, it would have been difficult for the Bank to assist India meaningfully as it tackles the remaining large challenges of lifting some 300 million out of poverty," said WB vice president for South Asia Isabel Guerrero.

"This new arrangement will work towards supporting India's development needs, showing the Bank can be innovative, flexible and responsive to the differentiated needs of our client countries," she said in a statement.

The bank said that like other emerging economies, India is faced with the challenge of removing bottlenecks in infrastructure and human skill development that can constrain its ability to sustain non-inflationary, rapid and inclusive growth.

In line with its aim to support India's development goals, the World Bank has nearly 80 active projects in India, with several large projects in the critical area of infrastructure.

The World Bank has also approved a $109 million funding for the Rajasthan Agricultural Competitiveness Project in India to enhance agricultural productivity through sustainable and efficient use of water resources.

The project is expected to increase agricultural productivity and farmer incomes through efficient water management, crop management, improved agricultural technology, farmer organizations and market innovations in some 20 selected areas in Rajasthan.

The initiative will benefit some 155,000 smallholder farmers, the Washington-based World Bank said in a statement Tuesday.

'The agricultural sector needs an end-to-end approach ranging from water management to better agricultural practices and marketing,' said Roberto Zagha, World Bank country director for India.

The project will be financed by a credit from the International Development Association (IDA), the World Bank's concessionary lending arm.


MSN.com, 28 March, 2012, http://news.in.msn.com/international/article.aspx?cp-documentid=5964179


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