No need for apprehensions over WB loans: Chidambaram

Hyderabad, June 8: Making light of apprehensions by the Left parties over the country going in for loans from international financial institutions with conditionalities, Union Finance Minister P Chidambaram today maintained that the country was securing World Bank loans only for productive purposes and repaying them promptly.

Speaking after the signing of a Memorandum of Understanding between the World Bank and the Andhra Pradesh Government for renovation of 3,000 minor irrigation tanks at a cost of Rs 1,044 crore to provide assured water for 2.50 lakh hectares, he said ''We need not have any apprehensions. It is there only to lend for countries like India.'' He lauded Andhra Pradesh for being the second state after Tamil Nadu for putting the project report for funding in a record 11 months before the World Bank.

Asserting that his government would continue to provide free power to peasants, Andhra Pradesh Chief Minister Y S Rajasekhara Reddy assured the people that neither the water cess nor municipal taxes would be hiked.

Subsidy would be provided to small farmers till they are in a position to pay for the services, he added.

The agreement was signed by Mr Madhusudan Prasad, Joint Secretary, Department of Economic Affairs, Union Ministry of Finance, Mr S P Tucker, State Principal Secretary, Irrigation and Command Area Development Department and Mr Salman Zaheer, World Bank representative.

The total World Bank assistance comprised 94.5 million dollar loan from the International Bank for Reconstruction and Development and 94.5 million dollar credit from the International Development Association (IDA), the World Bank's concessionary lending arm.

UNI