ADB to release $100 million from $2.9-billion financial package to Mizoram
19 Aug 2009
The Asian Development Bank (ADB) is releasing $100 million in loans to help Mizoram carry out public sector financial reforms that would improve the state government's finances and strengthen service delivery.
The loan is part of the $2.9-billion financial package cleared by the ADB last month to India despite strong objections from China due to the inclusion of funding for watershed projects in Arunachal Pradesh, parts of which, China claims to be a disputed territory region. (See: China fumes at ADB funding of Arunachal project)
The Manila-based ADB's board of directors today approved the funds for the Mirzoram Public Resourse Management Program. The programme aims to help the state government raise additional revenue from tax and non-tax sources, and improve debt management including pre-payment of high cost loans.
The programme also focuses on strengthening service delivery in the education and health sectors.
ADB's programme finance includes a $94-million loan and a technical assistance loan of $6 million, both drawn from ordinary capital resources. The loans have a 15-year term, including a 3-year grace period, with interest set in accordance with ADB's LIBOR-based facility. The programme is set to run from August 2009 to July 2012 and the state's finance department will be the executing agency.
"The state government of Mizoram has demonstrated strong political commitment to undertake financial reforms, including carrying out tough decisions on social policies relating to health, education, and public sector enterprises. ADB is pleased to support these efforts,'' said Ashok Sharma, director, financial sector, public management and trade division of ADB's South Asia Department.
