The Asian Development Bank (ADB) and the Indian government have inked a $220m loan agreement for improving connectivity as well as transport efficiency and safety on state highways of Rajasthan.
The loan is the first instalment of the $500m Rajasthan State Highway Investment Programme, which was approved by ADB Board in May 2017 for upgrading approximately 2,000km of highways and major district roads to two-lane or intermediate-lane standards in the state.
ADB said that the first tranche loan will improve almost 1,000km of state highways and major district roads. The loan can be replayed over a period of 25 years, including a grace period of eight years.
The total cost of the project is $1.41bn, with the government contributing $465m and $450m is being provided by the private sector and other concessionaries.
ADB country director of India Resident Mission Kenichi Yokoyama said: “One of the focus areas of the program is to attract private sector financing through government capacity building on public private partnership (PPP) development.
“ADB will finance part of the construction costs for the annuity-based PPP concessions and engineering procurement construction (EPC) contracts, enhance the stability of contract regime, and ensure good governance during project implementation.”