Exchange of Notes concerning Yen Loans for Three Projects in India
2023/3/29
On March 29, Mr. SUZUKI Hiroshi, Ambassador of Japan to India, and Mr. Rajat Kumar Mishra, Additional Secretary, Department of Economic Affairs, Ministry of Finance, Government of India, exchanged notes in New Delhi, concerning the provision of yen loans of up to a total of 126.814 billion yen for the following three projects.
1. Overview of the Yen Loan Projects
(1) Patna Metro Rail Construction Project (I) (loan provision of up to 98.612 billion yen)
This project is to provide a loan for the construction of Patna Metro Line 1 and Line 2 in Patna, Bihar. As a result, by 2030 (two years after completion of the project), new metro lines will be constructed with approximately 166 runs per day, which will be able to transport approximately 534,000 passengers on Line 1 and 267,000 passengers on Line 2. Japan has been cooperating in the promotion of metro projects in India by utilizing its excellent safety technologies and operational expertise, and has also contributed to the improvement of the urban environment, connectivity, and mitigation of the impact of climate change. It is expected that this loan would contribute to the sustainable urban development of Patna and the development of local economy, with focus on public transportation.
(2) Project for Forest and Biodiversity Conservation for Climate Change Response in West Bengal (loan provision of up to 9.308 billion yen)
This project is to provide a loan for the implementation of ecosystem-based countermeasures on climate change, biodiversity conservation and restoration, livelihood improvement activities for local residents, and strengthening of the organizational structure of the Department of Forests in West Bengal. As a result, new afforestation will cover approximately 3,900 hectares of land by 2033 (two years after the completion of the project), and approximately 75,740 tons of carbon dioxide will be stored in the forests. In addition, approximately 6,400 people will receive capacity-building training to strengthen the organizational structure of the Department of Forests. Japan has been contributing to the conservation of forests and biodiversity as well as to climate change responses in India, by utilizing its excellent knowledge and technology related to forest and biodiversity conservation. It is expected that this loan would contribute to the sustainable socio-economic development of West Bengal.
(3) Rajasthan Water Sector Livelihood Improvement Project (II) (loan provision of up to 18.894 billion yen)
This project is to provide a loan for the improvement of aging irrigation facilities and furnishing agriculture support services based on market demand in Rajasthan, while focusing on the participation of female farmers. As a result, by 2030 (two years after completion of the project), water use efficiency will be improved in 470,000 hectares of new farmland. In addition, annual gross agricultural revenues per household will be doubled from approximately 7,200 rupees (in 2017) to approximately 14,000 rupees (in 2030). Japan has been contributing to the development of agriculture and water use in India by utilizing its excellent knowledge and technology in the agricultural and water sectors. It is expected that this loan would contribute to improving the livelihoods of farmers in the project area and promoting the participation of women in socio-economic activities.
2. Terms and Conditions of the Loans
(1) For project (1) in 1 above
i. Interest rate: 1.70% per annum (0.01% per annum for consulting services)
ii. Redemption period: 30 years (including a 10-year grace period)
iii. Procurement terms: General untied
(2) For project (2) in 1 above
i. Interest rate: 1.50% per annum (0.01% per annum for consulting services)
ii. Redemption period: 30 years (including a 10-year grace period)
iii. Procurement terms: General untied
(3) For project (3) in 1 above
i. Interest rate: 1.05% per annum (0.01% per annum for consulting services)
ii. Redemption period: 15 years (including a 5-year grace period)
iii. Procurement terms: General untied
1. Overview of the Yen Loan Projects
(1) Patna Metro Rail Construction Project (I) (loan provision of up to 98.612 billion yen)
This project is to provide a loan for the construction of Patna Metro Line 1 and Line 2 in Patna, Bihar. As a result, by 2030 (two years after completion of the project), new metro lines will be constructed with approximately 166 runs per day, which will be able to transport approximately 534,000 passengers on Line 1 and 267,000 passengers on Line 2. Japan has been cooperating in the promotion of metro projects in India by utilizing its excellent safety technologies and operational expertise, and has also contributed to the improvement of the urban environment, connectivity, and mitigation of the impact of climate change. It is expected that this loan would contribute to the sustainable urban development of Patna and the development of local economy, with focus on public transportation.
(2) Project for Forest and Biodiversity Conservation for Climate Change Response in West Bengal (loan provision of up to 9.308 billion yen)
This project is to provide a loan for the implementation of ecosystem-based countermeasures on climate change, biodiversity conservation and restoration, livelihood improvement activities for local residents, and strengthening of the organizational structure of the Department of Forests in West Bengal. As a result, new afforestation will cover approximately 3,900 hectares of land by 2033 (two years after the completion of the project), and approximately 75,740 tons of carbon dioxide will be stored in the forests. In addition, approximately 6,400 people will receive capacity-building training to strengthen the organizational structure of the Department of Forests. Japan has been contributing to the conservation of forests and biodiversity as well as to climate change responses in India, by utilizing its excellent knowledge and technology related to forest and biodiversity conservation. It is expected that this loan would contribute to the sustainable socio-economic development of West Bengal.
(3) Rajasthan Water Sector Livelihood Improvement Project (II) (loan provision of up to 18.894 billion yen)
This project is to provide a loan for the improvement of aging irrigation facilities and furnishing agriculture support services based on market demand in Rajasthan, while focusing on the participation of female farmers. As a result, by 2030 (two years after completion of the project), water use efficiency will be improved in 470,000 hectares of new farmland. In addition, annual gross agricultural revenues per household will be doubled from approximately 7,200 rupees (in 2017) to approximately 14,000 rupees (in 2030). Japan has been contributing to the development of agriculture and water use in India by utilizing its excellent knowledge and technology in the agricultural and water sectors. It is expected that this loan would contribute to improving the livelihoods of farmers in the project area and promoting the participation of women in socio-economic activities.
2. Terms and Conditions of the Loans
(1) For project (1) in 1 above
i. Interest rate: 1.70% per annum (0.01% per annum for consulting services)
ii. Redemption period: 30 years (including a 10-year grace period)
iii. Procurement terms: General untied
(2) For project (2) in 1 above
i. Interest rate: 1.50% per annum (0.01% per annum for consulting services)
ii. Redemption period: 30 years (including a 10-year grace period)
iii. Procurement terms: General untied
(3) For project (3) in 1 above
i. Interest rate: 1.05% per annum (0.01% per annum for consulting services)
ii. Redemption period: 15 years (including a 5-year grace period)
iii. Procurement terms: General untied