Orissa to get $362-mn assistance from World Bank

New Delhi: The World Bank has approved a $362-million assistance package to Orissa to improve the State’s road network and also its agricultural tank system.

While the Orissa State Road project (OSRP) would get $250-million loan assistance, the Orissa Community Tanks Management Project would get $56 million credit and $56 million loan.

Only 22 per cent of Orissa’s roads are paved and most village and district roads remain unconnected to the national highway system.

The OSRP aims to remove transport bottlenecks in transport corridors through better performance, safety, and capacity of priority roads.

It would increase the role of the private sector in road infrastructure and assist the State Government to establish an institutional and governance framework in the sector, according to a World Bank release.

“An efficient road transport system is critical for improving the state’s investment climate and promoting a private-sector-led economic growth,” Mr Binyam Reja, World Bank Senior Transport Economist and Task Leader for this project, said.

“This project will lead to a significant reduction in transport costs for businesses and households in project areas, and ultimately boost growth through a better investment climate that will help the state exploit its mining, industrial and tourism potential.”

Meanwhile, the Orissa Community Tanks Management Project (OCTMP) is expected to rehabilitate some 900 tanks covering a cultivable area of about 1.2 lakh hectares spread across 29 districts of the State. The project will support improvements in production technologies and management practices, and promote better market linkages.

It will also strengthen community-based institutions, enabling them to assume greater responsibility for tank management. This is expected to increase productivity in agriculture, livestock and fisheries, and promote more effective and sustainable management of tank systems.

“The decline of tanks poses a serious threat to the agricultural economy of rain-fed areas dependent on tank irrigation in Orissa,” Mr Deepak Ahluwalia, World Bank Senior Economist and Task Leader for this project, said.

The $250 million loan for the OSRP has a 30 year maturity which includes a 5-year grace period. The $56 million credit for the OCTMP carries a 0.75 per cent service fee, a 10-year grace period, and a maturity of 35 years. The $56 million loan for the OCTMP has a 30-year maturity which includes a 5-year grace period.