Beijing-backed AIIB clears $750-million loan for India's Covid-19 fight

AIIB's total sovereign loans to India now amount to $ 3.06 billion, including a recent $500 million Covid-19 emergency response

China-backed Asian Infrastructure Investment Bank (AIIB) on Wednesday said it will extend a $750-million loan to India. This will go towards bolstering economic aid for businesses, including for the informal sector, expanding social safety nets for the needy, and strengthening the country’s health care systems.
 
AIIB’s sovereign loans to India amount to $3.06 billion, including a recent $500 million Covid-19 emergency response. This will be the second loan for India under AIIB’s Covid-19 Crisis Recovery Facility (CRF), which was created as part of the coordinated international response to counter the pandemic.
 
The Beijing-based multilateral funding agency is co-financing the project with the Asian Development Bank.

 
India is “extremely vulnerable to the pandemic, given that around 270 million people continue to live below the national poverty line”. Also, around 81 million live in densely populated informal settlements with limited access to health services. The disruption in economic activities threatens to impact poor households disproportionately, especially women, many of whom are employed in the informal sector, it said.
 
“Many of the world’s low and middle-income countries are still in the early stages of the health crisis but are already feeling the impact of the pandemic. This poses an enormous risk for millions across India who have only recently emerged from poverty,” said AIIB Vice-President, Investment Operations, D J Pandian.
 
AIIB does not have a regular instrument for policy-based financing. It is extending such financing on an exceptional basis under the CRF to support its members through projects co-financed with the World Bank or the Asian Development Bank.