Rs 4000cr Oecf Loan Extended By Japan Extends

Japan has extended a loan of Rs 4000 crore in the form of Overseas Development Assistance. As per the agreement, the loan would be used to finance ten major power and farm related projects.

Notes on the agreement for the loan transfer between Japan and India were exchanged yesterday with the Japanese being led by their Ambassador to India Sakutaro Tanino and the Indians by Montek Singh Ahluwalia.

The major power projects that would be financed by this loan include: the Simhadri and Vizag transmission project, the 900 mw Srisailam Left bank hydro project, the 280 mw Dhauliganga hydro project and the 420 mw Bakreswar thermal power project.

The loan for the transmission project which is being executed by the Andhra Pradesh State Electricity Board is over the loan that was earlier given by Overseas Economic Co-operation Fund (OECF) for the Simhadri power project being set up National Thermal Power Corporation.

The transmission project would evacuate power from the 1000 mw power station and would also help reduce transmission losses in the state.

Other major projects that would be financed through this loan include: the Small Scale Industries Development Programmes, the Tuticorin Port Dredging project and the Punjab afforestation project. Apart from this, the loan would also be used to finance two sericulture projects in Manipur and Madhya Pradesh.

The aid package is in the form of soft loans administered by the OECF. The loan would be based on a differential interest rate, with projects in the environment sector carrying a rate of 2.1 per cent per annum, and 2.3 per cent per annum for other projects, with a repayment period of 30 years.