ADB aid of $200 mn for tsunami relief

The Asian Development Bank (ADB) today approved a $200 million loan and grant assistance package to India.

This aid has been given for rehabilitation of people and reconstruction of damaged infrastructure in areas of Tamil Nadu and Kerala affected by the December 2004 tsunami.

The assistance package comprises a $100 million grant, drawing on the corpus from the ADB's Asian tsunami fund established in February 2005 and a $100 million loan from ADB's ordinary capital resources.

Of the amount, $ 143.75 million are allocated to Tamil Nadu and $ 56.25 million to Kerala.

"The project will focus on the highest priority areas, identified after consultation with the state governments, civil society, and other stakeholders.

Rehabilitation and reconstruction will be carried out to a pre-tsunami level or higher cost-effective and environmentally sustainable standards with design incorporating features critical to disaster prevention," said Arjun Goswami, principal governance specialist of the ADB.

The Centre and the governments of Tamil Nadu and Kerala will together contribute $18.6 million towards the project's total cost of $218.6 million.

In step with its disaster and emergency assistance policy, the ADB's loan will have a 32-year term, including a grace period of eight years.

Interest will be determined in accordance with the ADB's LIBOR-based lending facility.

The project's executing agency in Tamil Nadu is the revenue administration and the disaster management and mitigation department while in Kerala, it will be the department of disaster management. The project is to be completed in April 2008.

According to the joint needs assessment of the ADB-UNDP-World Bank, the reconstruction-financing needs caused by the tsunami amounted to at least $868 million in Tamil Nadu and $157 million in Kerala. The livelihoods of almost half a million families in these two states were affected.

To help accelerate reconstruction, the government asked for emergency assistance from the ADB, the (UNDP), International Fund for Agricultural Development and the World Bank.

The three donors and the government agreed to allocate livelihood restoration, transportation and rural and municipal infrastructure in Tamil Nadu and Kerala to ADB while the housing, fisheries, and agriculture sectors will be taken care of by the World Bank.Disaster risk management has been allocated to the UN.