India asks ADB to invest in fintech, health startups to improve quality

India on Saturday asked ADB to invest in fintech and health startups to help improve the quality of life in Asia while sharpening focus on infrastructure lending by ensuring loan disbursals within a year of request.

Economic Affairs Secretary Subhash Chandra Garg said that the Asian Development Bank (ADB) should factor in the number of poor people in a country while deciding resource allocation.

He was speaking on the sidelines of ADB's annual board meeting. The multilateral lender is making efforts to create 'Strategy 2030' to sustain its efforts to eradicate extreme poverty and to achieve sustainable growth in Asia and the Pacific.

"ADB should continue to place its primary focus on infrastructure creation, energy, communication, transportation, cities, rivers cleaning.... New technologies ... is the new revolution -- the digital age. While agriculture and industrial age will continue to exist, and we should not ignore that the digital age is going to shape up our future.

"ADB should become a facilitator of ushering in digital age in Asia. It should invest in innovations, in startups and venture capitals to help countries produce goods and services using technologies in digital age.

"It should invest in fintech, healthtech and other ways in which public services can be delivered to people of Asia to improve their quality of life," Garg said.

Urging the ADB to undertake more direct attack on poverty reduction, malnutrition illiteracy, including digital illiteracy, and health, he said ADB needs to review its administrative processes for delivering its finance and services to help realise its vision.

"For this, first, ADB should encourage adoption of country systems. Many countries in the region, including India, have sound country system and social and environmental safeguards. We would do well to adopt country systems for procurement safeguards and other fiduciary policies," Garg said.

Cautioning the ADB against adopting differentiated approach while lending to countries, the secretary said, "We do not believe differential pricing will either add to its capital, which is not needed at this moment, or lead to any significant revenue. Therefore, probably, pursuing this idea may not be very advisable."

He said ADB should factor in the number of poor people living in the country, besides income inequality and geographical imbalances, for resource allocation.

India is a founding member of the ADB and is currently the fourth-largest shareholder and the largest borrower of ADB sovereign lending since 2010. The multilateral lender has so far committed sovereign loans totalling USD 35.9 billion to India.

ADB should also introduce more targeted intervention in low income and poverty-concentrated geographic pockets, Garg said.

He added that keeping pace with the evolving needs of the developing member countries, ADB should substantially expand its private sector operations, especially equity financing and investment in new instruments of financing, like infrastructure investment trust.

Garg also called for speeding up processing of proposals and undertaking effective business process reforms.

"We should aim at delivering project financing within one year of it being posed. ADB may also need to post more international staff from headquarters to resident missions. ADB should open its missions in major business locations," he added.

He also suggested ADB to be a partner in the International Solar Alliance (ISA) to promote clean and renewable energy. The ISA is a treaty based inter-governmental alliance of 121 sunshine-rich countries.