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Monday, Nov 22, 2004

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AP to seek alternate sources if World Bank refuses loan

Our Bureau

Hyderabad , Nov. 21

THE Andhra Pradesh Government will make alternative arrangements to raise the required financial resources if the World Bank declines to release the second instalment of the Structural Adjustment Loan worth Rs 1,600 crore, according to the State Finance Minister, Mr K. Rosaiah.

In the light of the reports that the bank does not intend to release the loan until the State Government reviewed its policy of providing free power to the farm sector, Mr Rosaiah clarified that the structural allotment loan and free power policy were totally different aspects and not interlinked.

The present Congress Government in the State had not sought loan from the World Bank for undertaking reforms in the power sector.

He told newspersons here on Saturday that the World Bank had asked the State Government to reconsider its free power policy.

Similarly, a number of energy experts had also recommended that power should not be provided free of cost to all sections of the farmers and such a provision should be confined to small and marginal farmers.

However, so far there had been no proposal on the part of the Government to review its free power policy.

Mr Rosaiah said that the World Bank representatives, during their discussions with the State Government authorities, had stated that the bank would not link funding of other projects such as urban poverty alleviation and irrigation with the policy of free power.

The World Bank would evaluate these projects independently and the bank representatives had, in principle, agreed to fund the proposed irrigation projects in the State.

With regard to the A.P. High Court verdict directing the State Government to issue fresh notification allowing more companies to take part in the pre-qualification tenders pertaining to the works of irrigation projects, he said there had been a minor lapse in the earlier process, which the Government had rectified immediately as per the court directions.

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