KOCHI: In a big win for Kerala’s infrastructure rebuild plan, the World Bank and Asian Development Bank (ADB) have agreed to provide a USD 1-billion financial assistance to the state, which was devastated in the century’s worst floods in August.
The World Bank and ADB’s assistance of USD 500 million each will be disbursed over a three-year period. When contacted, Principal Secretary (Finance) Manoj Joshi told Express the multilateral agencies and Central Government have “orally agreed” for the USD 1 billion (about Rs 7,300 crore) for Kerala. To earn the two leading funding agencies’ confidence, the state Cabinet has formulated a four-tier structure for monitoring and implementing projects.
Joshi said the loan would come at an interest rate of Libor (London Inter-Bank Offered Rate) plus 25 basis points.
“The finer details are still being worked out and hence the disbursement will take some more time,” he explained.
World Bank-India country manager Junaid Ahmad, who met with Chief Minister Pinarayi Vijayan in Thiruvananthapuram on Tuesday, said disasters, like the one Kerala witnessed, can roll back decades of development and are a fundamental threat to economic development and the fight against poverty.
“The World Bank stands committed to support the CM’s vision of converting this tragedy, the biggest the state has seen, into an opportunity to build a more resilient Kerala for its people,” he added.
Francis Mathew, who has been managing ADB’s project lending, project financial management and loan/grant disbursement in several Asian countries, including India and China, explained such loans by the multilateral agencies will have a tenure of 20-25 years.
“The grace period for the project implementation will be 3-5 years, and the funds will be disbursed depending on the project’s progress,” said Mathew