ADB to provide USD 200 mn for rural road project in Maharashtra

Asian Development Bank (ADB) on Thursday said it has approved a USD 200 million loan for improving road infrastructure in 34 districts of Maharashtra to better connect rural areas with markets and services.

Roads in rural areas would be upgraded to all-weather standards which will boost links between local residents and economic centres across the state, the ADB said.

It highlighted that Maharashtra accounted for almost 15 per cent of the gross domestic product in 2016-17. However, economic development is concentrated around the urban centres of Mumbai, Pune, and Thane.

About 20 million people, or 17 per cent of the state's population, still live below the national poverty line, while in some districts -- particularly in rural areas -- it is as high as 40 per cent, it said.

"The upgraded roads under the ADB project will boost links between local residents, productive agricultural land, and economic centers across the state," said ADB Principal Portfolio Management Specialist Sanath Ranawana.

Improving farmers' access to markets will in turn help boost agricultural productivity and incomes as well as promote investment in agribusiness and agriculture value chain infrastructure, the official said.

The project will also work with the rural infrastructure agency, the Maharashtra Rural Road Development Association (MRRDA), to develop road safety, road asset management, contract management, and climate resilient design.

Accompanying the loan is a technical assistance grant of USD 1 million to support MRRDA to improve its management performance in these areas.

Outreach for road users will be carried out in the state to build awareness of road safety, gender issues including human trafficking, and enhancing women's road construction and maintenance skills.

The total cost of the project is USD 296 million, of which the government will provide USD 96 million. It is due for completion at the end of September 2024.

Maharashtra's agriculture accounts for about 47 per cent of employment, engages as much as 79 per cent of the rural labour force, and contributes 11 per cent to the state gross domestic product.

"However, this contribution is falling. Farmers face persistent crop losses due to the variable climate and limited access to processing and storage facilities, resulting in high levels of debts and even farmer suicides," ADB said.