$125 mn ADB loan for upgrade of NE roads

The Centre has signed a $125 million loan agreement with Asian Development Bank (ADB) for upgrade of roads in North Eastern states.

'The North Eastern States Roads Investment Program' is designed to reconstruct roads in the North Eastern states of Assam, Manipur, Mizoram, Tripura, Meghalaya, and Sikkim, thereby reducing the region's isolation and opening up growth and development opportunities. Improvements include widening existing sections of roads, strengthening pavements, raising embankments, and providing permanent structures at river crossings.

The signatories to the loan agreement were Nilaya Mitash, joint secretary of department of economic affairs, Union ministry of finance, and M Teresa Kho, country director of ADB, a press release said.

The project is expected to be completed by 30 September 2019 with improvements to more than 236 km of roads in Assam, Manipur, Mizoram and Tripura states.

The loan agreement for the first phase of the project, covering around 200 km of state roads in the states of Assam, Meghalaya and Sikkim, was signed in July 2012.

The second tranche from the ordinary capital resources of ADB has a 25-year term including a grace period of 5 years, commitment charge of 0.15 per cent per year (on un-drawn balance), maturity premium of 0.10 per cent (by straight line method) and interest rate to be determined in accordance with ADB's LIBOR-based lending facility. The loan of $125.2 million from ADB's ordinary capital resources makes up to 79.7 per cent of the total project cost of almost $157.2 million, with the central and state governments providing counterpart finance of $32 million.