Adb To Invest In Insurance Firms

This was disclosed during a press conference addressed by ADB vice president Bong-Suh Lee. We have been trying to create a situation in which the insurance industry will be opened up, a senior official John D Taylor, said.

ADB expects to overshoot its lending target of $650 million in India in the current year. I think our sanctions will be about $710 million for the public sector and $50 million for private sector projects in this country, Lee said.

The multilateral institution had lend $650 million to the public sector and $40 million to the private sector in India last year. It has lent $5.6 billion since it launched operations in India in 1985. You have to remember that the World Bank lends an equal amount on the projects we finance, Taylor said.

 

ADB has chosen Gujarat as the model state and plans to direct a substantial part of its lending to that state. Gujarat has started the process of restructuring on a large scale and we would like to assist the process, Lee said. Among the major projects being considered by ADB are an expressway linking Baroda and Bombay and a Delhi-Noida road project. On the bidding processes involved, Lee said ADB has been advocating global bidding for public sector projects but it was now encouraging global bidding for private sector projects also.

He said three financial institutionsICICI, SCICI and IFCIwhich will receive $300 million from the ADB will have to buy debentures of companies they will be on-lending. They will then be free to dispose of the debentures in the market by selling them to organisations like the UTI and other players in the financial market.

That way, the actual amount of funds raised will double. We feel that getting long-term rupee funds is a problem with infrastructure projects. The best thing to do is encourage savings and ensure better utilisation of the savings, Lee said.

The recently appointed resident representative of the ADB in New Delhi, Shigeko M Asher was also present at the press conference.