The Board of Directors of the Asian Infrastructure Investment Bank (AIIB) on Friday approved a $455-million loan for a road project in rural areas of Andhra Pradesh, the bank said in a statement.
“More than two million people living in rural areas of Andhra Pradesh stand to benefit from an improved road network connecting them with markets, schools and other services,” it added.
6,000 km of roads
The project aims for construction and upgradation of more than 6,000 km of roads connecting around 3,300 rural habitations in Andhra Pradesh.
“In addition to improving transport links to facilitate the delivery of agricultural and farm goods to markets, all-weather connectivity is also expected to result in better health and education outcomes. School attendance rates, especially among girls, are expected to improve,” AIIB said.
This is a second project AIIB has financed in Andhra Pradesh. In May 2017, the China-led bank sanctioned a $160-million loan for a power project in the State.
AIIB’s mandate focuses on promoting economic development in Asia by helping build sustainable infrastructure.
“By integrating the rural population with the rest of the State and markets, the project will extend economic development to the State as a whole,” said AIIB Vice-President and Chief Investment Officer DJ Pandian. He added that this is AIIB’s third investment in rural roads projects in India as such projects align with the Sustainable Development Goals and the Government of India’s priorities.
Largest loan recipient
The new loan takes AIIB’s total commitment to India to over $1.76 billion spread across seven infrastructure projects and a $200 million equity investment commitment to India’s National Investment and Infrastructure Fund (NIIF) approved earlier this year.
Beijing-headquartered AIIB was formed in 2016 with a committed capital of $100 billion. India, the second largest shareholder of AIIB with a 8.72 per cent stake is also the largest recipient of loans from the bank so far.