ADB & India Announce a $400 Million Financing Agreement to Build Urban Infrastructure!
India signed a policy-based $400 million loan agreement with ADB on Monday to develop quality urban infrastructure, enhance service delivery, and support effective governance systems, the finance ministry said in a statement. The program includes integrated planning reforms for controlling urban sprawl and promoting systemic and envisaged urbanization by strengthening the whole ecosystem of legislative, regulatory, and institutional reform. Sub-programme No 1 approved in 2021, with $350 million in funding, established national policies and guidelines for improving urban services. Sub-programme No 2 promotes investment planning and reforms at the state level and urban local bodies (ULBs) level.
Juhi Mukherjee Joint Secretary, Department of Economic Affairs, Ministry of Finance, signed the Loan Agreement for Sub-programme 2 with Takeo Konishi Country Director, Asian Development Bank (ADB) India Resident Mission. Mukherjee said that the Sub-programme supports the government’s strategy in the urban sector, with a particular emphasis on reforms to make cities livable and centers of economic growth by providing inclusive, resilient, and sustainable infrastructure. Konishi said that Sub-programme II supports the reforms started by the states and Union Level Laboratories in the implementation of the national flagship program atal mission for rejuvenation and urban transformation (AMRUT 2.0) aimed at universal access to water supply and sanitation.
Other mission objectives of the Sub-programme include: Reducing urban water losses; Recycling treated sewage for domestic use; Renovating water bodies; Maintaining sustainable groundwater levels; Modernising building bylaws; Land pooling; Urban agglomerations; Consolidated urban mobility planning; Transit-oriented development; Ensuring cities are well-positioned for economic growth through integrated planning processes. Climate and disaster resilience; Nature-based solutions; Improve urban environment; Improve cities’ financial sustainability through additional revenues.
City governments will be encouraged to adopt a range of reforms aimed at improving their revenue streams, property taxes, user charges, efficiency, and cost-effectiveness, the finance ministry said in a statement. This will significantly assist cities in leveraging innovative financing sources such as commercial loans, municipal bond issuance, sub-sovereign debt, and PPPs to plug large urban infrastructure gaps, the statement said.
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