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World Bank to extend $381 mn loan for Ganga project

Our Bureau New Delhi | Updated on July 07, 2020 Published on July 07, 2020

This assistance would be the second World Bank-funded project for the river Ganga.   -  Reuters

The variable spread loan has a maturity of 18.5 years, including a grace period of 5 years.

The World Bank would extend $400 million support to rejuvenate the Ganga by stemming pollution in the important river and strengthening the management of its river basin. According to an agreement signed between the World Bank and the government on Tuesday, $381 million would be the loan component and $19 million would be for proposed guarantee.

This would be the second World Bank-funded project for the river Ganga. It has been supporting the government’s efforts since 2011 through the ongoing National Ganga River Basin Project, which helped set up the National Mission for Clean Ganga (NMCG) as the nodal agency to manage the river, and financed sewage treatment infrastructure in several riverside towns and cities.

The agreement for the $381-million loan was signed by Sameer Kumar Khare, Additional Secretary, Department of Economic Affairs in Finance Ministry and Qaiser Khan, World Bank Acting Country Director, The guarantee instrument will be processed separately.

“The continuity provided by the Second National Ganga River Basin Project will consolidate the momentum achieved under the first World Bank project, and help NMCG introduce further innovations, and benchmark its initiatives against global best practices in river rejuvenation,” said Rajiv Ranjan Mishra, NMCG Director-General.

“The first World Bank project helped build critical sewage infrastructure in 20 pollution hotspots along the river, and this Project will help scale this up to the tributaries. It will also help government strengthen the institutions needed to manage a river basin as large and complex as the Ganga Basin,” said Junaid Ahmad, World Bank Country Director in India.

The sprawling Ganga Basin provides over one-third of India’s surface water, includes the country’s largest irrigated area, and is key to India’s water and food security. Over 40 per cent of India’s GDP is generated in the densely populated Basin. But the Ganga river is today is facing pressures from human and economic activity that impact its water quality and flows.

The $381 million variable spread loan has a maturity of 18.5 years, including a grace period of 5 years. The $19 million guarantee expiry date will be 18 years from the guarantee effectiveness date.

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Published on July 07, 2020
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