India, ADB sign $120 million loan pact for irrigation in Odisha

Selected areas for investment program are Baitarani, Brahmani, Budhabalanga and Subernarekha river basins and parts of Mahanadi delta

India and the Asian Development Bank (ADB) on Tuesday signed a $120 million loan pact to improve irrigation and water management infrastructure in Odisha.

The soft loan is the second tranche of a $157.5 million financing facility under the Orissa Integrated Irrigated Agriculture and Water Management Investment Program.

"The financing will be used for modernising seven irrigation subprojects resulting in improved irrigation in over 1,00,000 hectares and strengthening of Water User Associations (WUAs) and the institutional capacity of Odisha's Department of Water Resources," the Finance Ministry said in a statement.

The selected areas for the investment program are the Baitarani, Brahmani, Budhabalanga and Subernarekha river basins and parts of Mahanadi delta.

Raj Kumar, Joint Secretary in Department of Economic Affairs and M Teresa Kho, Country Director, ADB's India Resident Mission signed the loan agreement.

The second tranche loan from ADB's ordinary capital resources has a 20-year term. Odisha, acting through its Department of Water Resources, is responsible for implementing the second tranche activities and overall program, which are both due for completion by September 2018.

Speaking on the occasion, Kho said the investment program has "already demonstrated" the value of participatory irrigation management and will continue to support the WUAs to manage the planning, construction, and operation and maintenance of irrigation systems as an equal partner.

Raj said the project aims to improve existing irrigation infrastructure, operation and maintenance and water use efficiency that will lead to higher agricultural productivity.