Japan to extend soft loans for 7 large projects

New Delhi: Japan on Monday agreed to extend soft loans amounting to Rs 7,074 crore for seven large-scale projects including the Delhi MRTS Project (Phase-II), Hyderabad Outer Ring Road project and the Hogenakkal Water Supply project in Tamil Nadu.

The concessional loans under the Official Development Assistance (ODA) package would be made available through the Japan Bank for International Cooperation (JBIC). The total soft loan committed by Japan for financial year 2007-08 stood at Rs 8,582 crore if the Rs 1,345 crore loan package committed in August 2007 was also counted.

The Exchange of Notes were signed and exchanged between Mr Hideaki Domichi, Ambassador of Japan to India, and Mr Kumar Sanjay Krishna, Joint Secretary in Finance Ministry, on behalf of their respective Governments, in the presence of the Union Finance Minister, Mr P. Chidambaram, here today.

The seven projects for which the soft loan assistance is being provided are the Haryana Transmission System Project (loan amount of Rs 796.78 crore), Delhi MRTS Project Phase-II (Tranche III) (Rs 2,748.45 crore), Kolkata-East-West Metro project (Rs 245.37 crore), Hyderabad Outer Ring road project (phase-1) (Rs 1,595.43 crore), UP Participatory Forest Management and Poverty Alleviation project (Rs 508.71 crore), Hogenakkal Water supply and Fluorosis Mitigation project (Rs 853.39 crore) and Tamil Nadu Urban Infrastructure project (Rs 325.96 crore).

Mr Chidambaram highlighted that Japan’s ODA loan commitment for financial year 2007-08 recorded 21.76 per cent increase over last year’s ODA commitment. This is also the highest ever ODA loan commitment from Japan to India and India continues to be the highest recipient of ODA from Japan, Mr Chidambaram added.

The Finance Minister said that in the last few years relations between India and Japan have steadily progressed based on India-Japan Global Partnership. The visits of the Indian Prime Minister to Japan in 2006 and the visit of the Japanese Prime Minister to India in 2007 have further strengthened the partnership, he said.

The main objective of Japanese loan assistance is to support India in establishing physical infrastructure to boost and sustain economic growth.