World Bank helps India, grants loan of $ 4.3 billion

September 23, 2009 – IR Summary/Yahoo/Reuters -

The World Bank has come to the rescue of India, on Tuesday, it has approved $4.3 billion in loans  to help its finance infrastructure building and to shore up the capital of some state banks as the economy recovers from the global financial crisis, a good news for India.

“The logic of these four loans is that they should support India’s economic recovery by enabling enterprises to get access to credit and … enabling investment in infrastructure,” Roberto Zagha, World Bank country director for India, told Reuters.
The loans are part of the World Bank’s $14 billion in crisis-related lending for Asia’s third-largest economy over three years through 2012.

Zagha said while the worst of the crisis was over, there was uncertainty about the pace of the recovery.

He said economic growth in India of between 5.5 percent and 6.5 percent in 2009/10 was realistic, but cautioned that the country’s economic prospects hinged on a broader global recovery.

“If we don’t see a (global) recovery, then India will not be able to grow at the rates it used to grow in the past of around 8 percent,” Zagha told Reuters.

India’s reserve bank cut its main lending rate by 425 basis points (4.25 percentage points) between October and April, and added massive liquidity to markets as the global downturn hit the economy harder than expected.

As part of its response, the World Bank said it would provide $2 billion to India’s banking sector designed to expand the volume of credit available to firms.

A global credit squeeze prompted banks to cut back on lending, but Zagha said tight credit conditions now appeared to be easing in India.

Also, the global crisis put added demands on public sector banks, as lending and deposit-taking by private and foreign banks have slowed.

“This loan will help maintain credit growth levels, support social banking and employment growth, and help strengthen the economic recovery ahead,” the World Bank said.

The Bank also approved $1.2 billion for the India Infrastructure Finance Co Ltd to spur private financing for public-private partnerships in infrastructure, and to stimulate the development of a long-term local currency debt financing market.
In addition, the World Bank approved $1 billion to address India’s acute power shortages by assisting the Powergrid Corp of India, the national electricity company, with its investment program after a freeze in lending from overseas.

The Bank also provided $150 million to Andhra Pradesh state to improve water supply and sanitation services for 2,600 villages across six districts.
(Reporting by Lesley Wroughton; Editing by Leslie Adler, Phil Berlowitz)
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Dr. Raj Baldev, Cosmo Theorist

About Dr. Raj Baldev, Cosmo Theorist

Dr. Raj Baldev, Cosmo Theorist, Ph.D., D. Litt., D Sc. (H.C), Editor-in-Chief of International Reporter, Chairman Media International Ltd., Born on 15 January 1927 in Montgomery, now in Pakistan. Internationally known, man of letters with over dozen of books and thousands of articles to his credit on various subjects including theories on the Creation of the Universe, the Black Holes, Supernovas and other functions of the Universe, Nature and Life , which he described both ways, philosophically and scientifically. He further elaborated how the entire Cosmos were formed. He holds spiritual wisdom of predicting and curing powers of the human problems, so much so, he is popularly known as Destiny Repairer, hence people call him with respect as Swamy Ji. He got the privilege of leading various Parliamentary Delegations abroad on good will missions; he also got the privilege of being invited by differnt Heads of State on state visits. He is the Founder of God Believers (GBA) who place belief in “FAITH”, Universal Modern Religion. FAITH is not a religion but a human service, an encyclopedia of creating healthy balance between Science and God. The main purpose of this mission is to defend the Identity of God from Scientists on one hand and to help fight Global Environmental Abuses, to create awareness of high risks of Excessive Nuclear Stockpiles, global service to the Human Rights and Justice on the other. He is a very simple man, he commands special respect as a holy man with high spiritualism and people address him as His Holiness. He is equally dedicated to the cause of media and journalism where he has been serving the people through his writing for over 50 years; he has also served as Member of Press Council of India. His main aim is to serve the humanity and all kinds of life on the Earth, to serve the elders, women and children, the blind, crippled, lepers and the needy, he is committed to save the Mother Earth from the abuses caused by humans and the nature through the social mission of God Believers (GBA), which also serves the World Peace. In short, he is a global social reformer. Google