WB approves US$4.3bn in loans for India

The World Bank has approved US$4.3bn in loans for India to help it bolster its tardy infrastructure and help shore up the capital of some public sector banks. The loans are part of the World Bank's US$14bn in crisis related lending for Asia's third-largest economy over three years through 2012. The World Bank would provide US$2bn to India's banking sector in order to expand the volume of credit available to the local companies. The World Bank also approved US$1.2bn 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 US$1bn to address India's acute power shortages by assisting the Powergrid Corp of India with its investment program. It also provided US$150mn to Andhra Pradesh to improve water supply and sanitation services for 2,600 villages across six districts. India can attain a GDP growth of between 5.5% and 6.5% in FY10, but this depends a great deal on how quickly the global economy recovers, World Bank country director for India, Roberto Zagha was quoted as saying.