India, ADB ink loan pact for industrial corridor
India and ADB have signed USD 375 million pact for loans and grants to develop 800-km Visakhapatnam-Chennai Industrial Corridor, which is the first phase of a planned 2,500-km East Coast Economic Corridor.
ADB had last September approved USD 631 million in loans and grants for the industrial corridor.
- The Asian Development Bank approved loans comprising a USD 500 million multitranche facility to build key infrastructure in the four main centers along the corridor -- Visakhapatnam, Kakinada, Amaravati, and Yerpedu-Srikalahasti in Andhra Pradesh.
- The first tranche of USD 245 million that was signed will finance sub projects to develop high-quality internal infrastructure in 2 of the 4 nodes of the corridor -- Visakhapatnam and Yerpedu-Srikalahasti.
- Another component of the approved ADB funds that the signatories signed was a USD 125 million policy-based loan that will be used for capacity development of institutions engaged in corridor management, provide support to enhance ease of doing business and for supporting industrial and sector policies to stimulate industrial development.
- Along with the ADB loans, agreement was also signed last evening for a USD 5 million grant from the multi-donor Urban Climate Change Resilience Trust Fund that is managed by ADB to build climate change resilient infrastructure.
- Among the outputs envisaged under the USD 245 million tranche-1 loan include strengthening and widening of a 29.6-kilometer section of state highway to four lanes to improve connectivity from Kakinada Port to National Highway 16, investments in smart water management in Visakhapatnam to reduce non revenue water and provide continuous water supply.
- Tranche-1 loan will have a 25-year term, including a grace period of 5 years, a 20-year straight line repayment method at an annual interest rate determined in accordance with ADB's LIBOR-based lending facility.
- Manila based ADB, established in 1966, is owned by 67 members - 48 from the Asian region.