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World Bank sanctions $ 516-million loan for road projects

The World Bank has announced sanction of a $ 516-million loan to meet partly the cost of the 6,000-km 'golden quadrilateral' road project between the four metros and the North-South and East-West Corridors.

The loan would be utilised for upgradation of 475-km-long National Highways in Uttar Pradesh and Bihar, a World Bank statement said.

Total project costs are $ 650 million to which the Government of India will contribute $ 134 million and the bank will provide a $ 516-million variable spread and rate single-currency loan with a grace period of five years and 20 years to maturity.

The New Delhi-Bombay-Madras-Calcutta Golden Quadrilateral and the corridors to provide access to key ports have been estimated to cost a whopping Rs 200 billion. Prime Minister Atal Bihari Vajpayee, as part of government's efforts to improve infrastructure facilities in the country, announced both the projects.

While the project for linking the metros is slated for completion by 2003, the corridor venture would continue till 2009.

The loan sanctioned Thursday would finance The India Third National Highways project, covering some of the most under-developed regions of India in the states of Uttar Pradesh and Bihar that have almost completely missed out on the recent economic growth in other parts of the country, in part because of poor infrastructure, says Chris Hoban, project task leader and operations adviser for India at the World Bank.

The World Bank loan would specifically finance civil works for widening and strengthening about 475 km of the national highway from two lanes to four or six divided carriage-ways.

It would also cover environmental management, including tree plantation and a programme of road work to introduce alternative maintenance contracting methods and improve traffic management and safety.

The project will support the National Highway Authority of India, or NHAI, in the development and maintenance of the 6,000 km 'golden quadrilateral' between Delhi, Calcutta, Madras and Bombay, and the development of the strategically important North-South and East-West corridors and access to key ports.

India's 52,000 km of national highways account for about 1.6 per cent of the total road network of 3.3 million km but carry over 40 per cent of the road traffic. All but 500 km of the national highways are two-lane roads or narrower, leading to serious traffic congestion.

The government's strategy for the road sector in previous decades had focussed on rapid expansion of rural connectivity at the expense of the core highway system, and did not provide adequately for maintenance. This has come at a price, namely high transport costs, travel delays and accident rates. The government has begun to address these issues by increasing allocations for construction and maintenance and increasing the emphasis on the role of the private sector.

UNI

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