India signed Loan agreement with ADB for improving water suppy in Bihar

Indian Signed Loan Agreement with Asian Development Bank for improving water supply in Bhagalpur and Gaya in Bihar Details, Purpose, Benefits

The Government of India has signed Loan Agreement with Asian Development Bank (ADB) on 23rd February 2018 at New Delhi.

The Loan Agreement was signed between Sameer Kumar Khare, Joint Secretary (Multilateral Institutions), Department of Economic Affairs, Ministry of Finance, for the Government of India and Kenichi Yokoyama, Country Director of ADB’s India Resident Mission.

The USD 84 million loan agreement was signed for financing the improvement and expansion of water supply in Bhagalpur and Gaya towns in Bihar.

The tranche 2 loan is part of the $200 million, Multi-tranche Financing Facility (MFF) for the Bihar Urban Development Investment Program that was approved by ADB in 2012.

As per the officials, the loan will have a 25-year term, including a grace period of 5 years, an annual interest rate determined in accordance with ADB’s lending facility based on the London interbank offered rate (LIBOR), and a commitment charge of 0.15% per year.

The Project 2 aims to improve access to a better quality water supply for the 1.1 people of Bhagalpur and Gaya towns. It will also promote better water management practices that will result in citywide coverage with the 24-hour uninterrupted supply of treated water of 135 liters per capita per day in both cities by 2021. ‘

Both the towns of the project would retain the national urban service goals or match many of the national averages for urban service delivery performance in India. The investment program will assist ULBs in designing affordable tariffs for O&M cost recovery.