| 1. |
The
Government of Japan today agreed to extend a massive
package of Official Development Assistance to India,
in the form of soft loans totaling about
Rs. 5600 crore (134,466 million yen). The
Exchange of Notes to formalize the agreement to
this effect was concluded this evening at a ceremony
held in the Ministry of Finance in New Delhi. The
Notes were signed and exchanged by H. E. Mr. Yasukuni
Enoki, Ambassador of Japan to India, and Mr. S.
G. Mankad, Additional Secretary, Ministry of Finance,
Government of India, on behalf of their respective
Governments.
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Package
sets a new peak of Japanese assistance
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| 2. |
Fiscal
2003 was a landmark year for the growing Japan-India
development partnership, as India became the largest
recipient of yen loan assistance from Japan that
year. With the Yen loan commitment to India
going up this year by 7.57 per cent over the previous
year’s commitment, India once again emerged as the
top recipient of Japanese loan assistance. The
increase in assistance this year takes Japan-India
development partnership into an ascending mode. Even
though, owing to difficult fiscal conditions, Japan’s
global loan package has been staying at a relatively
low level (approximately half the peak level of 1996)
since the last five years, by contrast, the
Japanese assistance to India this year has set a
new peak level of assistance.
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Highlights
of the loan package
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| 3. |
The
loan package covers 8 large-scale projects in
the areas of power, transportation, irrigation,
water supply and environment. Among the projects,
North Karanpura Super Thermal Power Project, Uttar
Pradesh Buddhist Circuit Development Project and
Ganga Action Plan Project deserve special mention.
(See Enclosure 2 for outline of all the 8 projects)
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North Karanpura Super Thermal Power Project -
Inclusion of this project in Jharkhand State
in the loan package underscores the special emphasis
given to power sector in Japan’s development cooperation
to India. This big project, to be completed at the
total cost of over Rs.8000 crore and designed to generate
efficiently 1,980 MW through advanced technology, will
significantly strengthen power supply situation in
the eastern region. The project is expected
to emerge as a major symbol of cooperation between
Japan and India in the power sector.
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Uttar Pradesh Buddhist Circuit Development Project
-
Although in terms of the amount of assistance
this project may not be very large, the project has
a very special significance as it highlights centuries-old
ties between Japan and India. Buddhism, having
a vast following in Japan, symbolizes a very special
bond of friendship between the peoples of the two countries. This
project, to develop tourism-related infrastructure
along the Buddhist circuit in Uttar Pradesh, is expected
to pave the way for larger flow of Buddhist pilgrims
and other tourists from Japan and other countries,
and thereby enhance people-to-people exchange
between Japan and India. The economic activities
catalyzed through the project will also help alleviating
poverty in the vast area that comes under the Buddhist
circuit in the state.
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Ganga Action Plan Project - Taking up of this
project for loan assistance this year fulfills the
promise made in 2001 by the Japanese Prime Minister
Mr. Junichiro Koizumi
to provide Japanese Governmental assistance
to support India’s efforts to improve the quality of
water of the river Ganga. The project involves enhancing
sewage treatment capacity and improving overall public
health environment, by way of public awareness campaign
and construction of public toilets in the Varanasi
area.
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Strategic
assistance for sustained economic growth and
poverty alleviation
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| 4. |
The
main objective of Japanese loan assistance is to
support India in establishing physical infrastructure
to boost and sustain economic growth. At the same
time, Japanese assistance seeks to support India’s
efforts to alleviate poverty. In keeping with these
goals, the loan package strategically covers power,
urban transportation, drinking water supply, irrigation,
and afforestation projects.
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Enclosures:
1. List of Projects
2.
Outline of Projects
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Enclosure
- 1
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JAPAN’S
ODA LOANS TO INDIA FOR 2003-04
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LIST
OF PROJECTS
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PROJECT AMOUNT
(in
million yen)
|
| 1. |
Delhi
Mass Rapid Transport System
Project (VI)
|
19,292
|
| 2. |
North
Karanpura Super Thermal Power Project (1)
|
15,916
|
| 3. |
Rajasthan
Minor Irrigation Improvement Project
|
11,555
|
| 4. |
Tamil
Nadu Afforestation Project (II)
|
9,818
|
| 5. |
Karnataka
Sustainable Forest Management and Biodiversity Conservation
Project
|
15,209
|
| 6. |
Ganga
Action Plan Project (Varanasi)
|
11,184
|
| 7. |
Bangalore
Water Supply and Sewerage Project (II-1)
|
41,997
|
| 8. |
Uttar
Pradesh Buddhist Circuit Development Project
|
9,495
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Total |
134,466 |
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Enclosure
- 2
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BRIEF
OUTLINE OF YEN-LOAN PROJECTS FOR FY 2004
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Delhi
Mass Rapid Transport System Project (VI)
This ongoing project for the construction of Delhi
Metro receives Rs.800 crores as the sixth tranche of
time-sliced loan assistance. The project, aiming to
mitigate traffic congestions and preventing environmental
pollution, is fast under progress. When all the lines
become operational by March 2006, the system is expected
to carry 2.26 million passengers a day, nearly the
same volume that Tokyo metropolitan Subway carries
at present.
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North
Karanpura Super Thermal Power Project (I)
This project is aimed at constructing a large-scale coal fired
thermal power plant with a generating capacity of 1,980 MW (660X3)
in the state of Jharkhand. The power plant will be serving to alleviate
chronic power shortage and reinvigorating the industry in the eastern
region. The project receives Rs.663 crore loan at a very low interest
rate of 0.75%.
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Rajasthan
Minor Irrigation Improvement Project
The comprehensive project aims at increasing agricultural output
by rehabilitating existing minor irrigation facilities, organizing
farmers’ water user associations, and disseminating farming technology
in the rain-deficient state of Rajasthan. Also, in partnership
with local NGOs, the project will help upgrade the living conditions
of the poor. The project receives a loan of Rs.481 crores.
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Tamil
Nadu Afforestation Project (II) & Karnataka Sustainable
Forest Management and Biodiversity Conservation
Project
Under these two projects for environmental improvement, trees will
be planted with the participation of community residents in very
large areas in the respective states of Tamil Nadu and Karnataka,
to revive forests and to improve living conditions of the local
people. Under the project, local populace will be provided occupational
training. Also micro-finance will be extended to those who depend
on forests for living. In the case of Karnataka Sustainable
Forest management and Biodiversity Conservation Project, the
aim is also to preserve bio-diversity in the Western Ghats, where
75% of mammals, birds and amphibians on the endangered list inhabit
only 2.3% of the land surface of the planet. The Tamil Nadu and
Karnataka projects respectively receive Rs.409 crore and Rs.634
crore loan assistance at a very low rate of interest of 0.75% per
annum.
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Ganga
Action Plan Project (Varanasi)
This project is intended to support the improvement of water quality
of the Ganga river by enhancing water treatment capacity of the
sewerage facility. Under this project, with a view to improving
the overall public health environment, the awareness raising campaign
will be held to enlighten citizens and government officials about
public hygiene, and community toilets will be constructed in slums,
and bathing places as well. A loan of Rs.466 crore is to be provided
at the low interest rate of 0.75% per annum.
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Bangalore
Water Supply and Sewerage Project (II-1)
This project intends to support activation of the industry and
poverty alleviation in the rapidly growing Bangalore metropolitan
area, by developing water supply and sewerage facilities, putting
in place measures for comprehensive improvement of water business
management, and developing water supply and sewerage system in
the slums. The project gets the loan assistance of Rs.1750 crores.
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Uttar
Pradesh Buddhist Circuit Development Project
The projects aims at making effective use of tourist resources
and promoting regional industries by improving tourism-related
infrastructure and capabilities along the Buddhist Circuit in the
state of Uttar Pradesh, where the largest stratum of impoverished
people concentrates, thereby contributing to the regional development
conducive to the employment creation and poverty reduction in the
State.
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