State lines up Rs 1,299 crore of projects for external assistance

The Orissa government has decided to seek external assistance for three more projects with a combined investment of Rs 1299 crore. These projects belong to housing and urban development (H&UD), water resources and finance departments.

The State Level Project Monitoring Committee (SLMC) on Externally Aided Projects (EAPs) recently cleared the projects which will be put before the external agencies for assistance.

The committee deliberated on seven projects before picking up the three projects. The projects are Orissa Integrated Sanitation Improvement Project (OISIP), Dam Rehabilitation and Improvement Project (DRIP) and gave in-principle clearance to Orissa Development Policy Support Programme for Sustainable Growth and Governance (ODPSPSGG).

While OISIP and DRIP were cleared, ODPSPSGG was accorded in-principle clearance as this project is in a conceptual stage, sources said.

“The respective administrative departments have been asked to move forward in the matter”, a senior official of the state Planning and Co-ordination department told Business Standard.

The OISIP proposed by the housing and urban development department envisages an investment of Rs 945.13 crore and will run up to 2012 in the first phase. The tenure may further be extended depending on the requirement.

It aims to improve public hygene through introduction of organised sewerage network for collection of sewerage from households, their transportation and treatment. The area of the project will cover Cuttack and Khurda districts and targets the urban and slum population. The project will be posed for assistance from Japan Bank for International Cooperation (JBIC.)

Similarly, the Rs 226 crore DRIP project, proposed by the water resources department, aims to rehabilitate and improve the dams and associated appurtenances for improving the safety and operational performance of selected existing dams in a sustainable manner. It will ensure the full reservoir capacity of project dams, achieving effective utilisation of stored water and monitoring the long term performance of the dam.

The project will cover about 40 major, medium and minor irrigation projects in 18 districts. The work on the project will start from the current fiscal and will be completed in 2014-15. The proposal will be sent to the World Bank for funding sources added.

On the other hand, the Rs 128 crore Orissa Development Policy Support Programme is proposed to be implemented from 2010-11 to 2015-16. The programme aims to enhance the state government’s ability to reduce poverty, strengthen capacity to manage revenue, expenditure and private sector development in the state.

While the policy framework and the institutions at the district and state level will be strengthened, it is expected to achieve better development of micro, small and medium enterprises (MSMEs) in the state. The project will be posed before the department for international development (DFID) of the U K government for assistance.

Sources said, the administrative departments have been asked to seek the approval of the government and send these proposals to the concerned ministry in the Union government. The proposals will be sent to the department of economic affairs (DEA), Government of India, before being put before the external donor agencies.

Since the assistance will be in the form of loans, the state planning and co-ordination department and the finance departments will take a view on the cost of credit and the advantages to be accrued from the projects before moving to get loans from the external donors.

It may be noted, the foreign exchange risks were earlier borne by the Union government which was charging a interest rate higher than charged by the donor agencies. However, at present this is being done on a back to back basis, where all the forex risk and the advantages are borne by the state government.