In a fresh boost to the infrastructure development and a new lease of life to the Economic Reconstruction Agency, the Asian Development Bank (ADB) has conveyed in principle acceptance of a fresh loan of US $ 500 million. Anticipated to be spent in 10 urban belts in the state – five each in Jammu and Kashmir region including the twin capital cities, the loan will help government address key social sector infrastructure, informed sources said
“The Rs 1200 crore loan has been agreed to,” a top officer privy of the development said. “It will take a bit of time to finalise the deal.”
In the 500 million dollor loan, J&K government will have to contribute US $ 100 million from its own sources. Of the rest $ 400 million, ninety percent will be paid by the central government. ADB loans carry longer repayment schedules and are dirt cheap.
This is the second major ADB loan to J&K. The last loan of Rs 1694 crore led to the creation of the ERA in last PDP-Congress government in February 2004 as the sole agency to manage and implement funded by multilateral agencies. That loan was the first that was part of the larger loan for divided Kashmir as part of it went to the reconstruction of PaK.
Informed sources said that ERA has so far spent Rs 1213 crore and the balance Rs 667 crore in different stages of implementation. The projects currently under way include the Srinagar flyover project that is facing time and cost overruns because of weather and situation.
Source said from the new loan, J&K plans to invest in road projects for Srinagar city while it will address the chronic water supply issues in Jammu. As far as eight other district-towns are concerned, it is yet to be decided which districts will eventually be selected and for what purpose. “Roughly you can assume one district from Chenab Valley, one from Pir Panchal, one from Udhampur and one from Kathua,” one officer said. “It again will be south, north, centre and Ladakh in Kashmir.”
Though the ERA is internally in a sort of mess, the fresh tranche has given it a fresh lease of life. While it would continue to exist, the authorities may have to get deep into its systems, formal and informal and ensure the resource and the process are actually spent adequately.