World Bank scales up lending support to India

New Delhi, Feb 12 (UNI) The World Bank today announced scaling of its lending operations in India from the current year's level of 3.5 billion dollars to four billion dollars per year in the next three years and said it would increasingly shift the focus of its funding to projects for the improvement of living conditions in 'Bharat'.

''We expect the other India to move slower than the fast lane India. This is where we will concentrate our enregies in the years to come. A part of that startegy would be to increasingly take up projects in the lagging states of India,'' Mr Praful C Patel, World Bank, Vice-President for South Asia, told a news conference here.

On the occassion, Mr Patel introduced to the audience Ms Isabell Guerrero, the new Country Director for India.

In the expected sectoral break-up of lending agriculture and rural development will get 17 per cent; energy 16 per cent, finance and private sector 9 per cent, human development 18 per cent; infrastructure 16 per cent and transport 13 per cent.

The lagging states where funding will be focussed include Bihar, Orissa, Uttar Pradesh and Jharkhand.

Mr Patel said if some states continue to lag behind then the progress of the entire country can be held hostage.

The World Bank official said India was really two countries -- one which was moving at a fast pace and the other where material well being and growth moved slowly.

The expectation was that the fast lane India will move still faster and the country where the poor reside will move slowly even in the year's to come.

Mr Patel, however, hastened to add that the Indian government was serious about having inclusive growth and fulfilling the Millenium Development Goals (MDGs).

Asked what would be the growth this fiscal, Mr Patel said that he has been told by the government that it would be in the region of 9.2 per cent.

Mr Patel said a new element in the staretgy of the bank would be better co-ordination with other donors.

Asked what would be the component of the IDA, the soft window agency of the bank, and IBRD in the next three years, Mr Patel said IDA was fixed for India and would continue to be in the region of 1.7 to 2 billion dollars per annum. But a more important concern of the bank was the manner in which the funds would be deployed and the quality of service delivery.

Mr Patel said a number of new projects would be taken to the board which would meet in July for the next year lending strategy for India. These include approval for a 500 million dollar loan for rural credit co-operative. The other donor for this project would be the Asian Development Bank and the two agencies will give a total loan of 1.5 million dollars for this purpose.

Asked as to why was there such a delay in giving emphasis on lagging states, Mr Patel said the World Bank ''does not do things on its own'' and it was finally at the advice of the Indian government that a renewed thrust was given to development of backward states.

Giving details Mr Patel said for Bihar the estimated allocation is 1.5 billion dollars in the next three years. This includes 400 million dollars already under project preperation, 500 million dollars for development policy, and 200 million dollars each for urban water resource management and flood and drought irrigation.

Mr Patel said he has just returned from Bihar and commended the policy changes being brought forth by the present government and its sincerity in implementing programmes directed at the poor. He said the bank will have an enhanced dialogue with the state government and the scaling up support will focus on livelihood.

Mr Patel said just some times back the state government was getting almost no support from multilateral funding agencies.

In Orissa, the World Bank commitement will be 700 million dollars and the emphasis would be on health, water resource management, livelihood, and building of state roads.

In Uttar Pradesh, the loan component would be to the tune of 350 million dollars and the pipeline projects relate to agriculture and health.

In Jharkhand the bank's commitment was to the tune of 40 million dollars for livelihood projects.

UNI