India has secured two Asian Development Bank (ADB) loans valued at INR73.2 billion (USD850 million) to support the nation’s green and sustainable infrastructure projects as well as the manufacturing sector and its supply chains, respectively.
The USD500 million loan for sustainable infrastructure will be extended to India Infrastructure Finance Company Limited (IIFCL) with a sovereign guarantee. This means that, should IIFCL default, the government will step in and pay the financial obligations.
The USD350 million loan to support India’s manufacturing sector and its supply chains have been granted in alignment with India’s climate commitments and ADB’s Strengthening Multimodal and Integrated Logistics Ecosystem (SMILE) programme.
IIFCL is a wholly government-owned company and has worked closely with ADB over the years. The Financing Environmentally Sustainable Growth in Infrastructure Project will build IIFCL’s capacity to integrate best green practices into its infrastructure projects. The project will enable IIFCL to extend capital to projects focusing on connectivity and energy transitions, along with under-resourced projects on urban development, education and healthcare.
The USD350 million policy-based loan will help the government achieve logistics reform in India. The programme will assist in:
- Improving efficiency in multi-modal logistics at national, state and city levels;
- Standardise logistics assets such as warehouses to encourage and incentivise investments;
- Improving efficiency in external trade logistics; and
- Adopting efficient and low emission logistics.
The project is expected to drive sustainable economic growth through the adoption of policy, digital and infrastructure development reforms that will reduce costs, improve efficiency, generate sustainable employment and even promote gender inclusion.
The collaborations are a testament to the shared goals of both the Indian government and ADB to foster sustainable growth, development and innovation.
