The loan is part of the $120-million multi-tranche financing facility for the integrated flood and riverbank erosion risk management investment programme
Guwahati: In a bid to to control the menace of flood and erosion in Assam, the central government and the Asian Development Bank (ADB) signed a $60-million loan agreement on Thursday, as per the finance ministry.
According to a ministerial statement, "The Tranche 2 loan is part of the $120 million multi-tranche financing facility for the Assam Integrated Flood and Riverbank Erosion Risk Management Investment Programme approved by the ADB Board in October 2010."
The loan would provide financial assistance to the flood-ravaged state to continue riverbank protection works, renovation of flood embankments and community-based flood risk management activities in critically flood-prone areas along the Brahmaputra river in Assam.
The agreement was signed by additional finance secretary Sameer Kumar Khare on behalf of the Central agovernment and ADB's India resident mission country director Kenichi Yokoyama.
Speaking about the deal, Khare siad: "The programme is aimed at increasing the reliability and effectiveness of flood and riverbank erosion risk management systems in flood-prone areas of Assam, strengthening the disaster preparedness of the communities and developing institutional capacity and knowledge base for flood forecasting."
"The Project 2 under the programme will fund a combination of structural and non-structural measures in the three sub-project areas of Palasbari-Gumi, Kaziranga and Dibrugarh along the Brahmaputra river which include 20 km of riverbank protection works and upgrading of 13 km of flood embankments," Yokoyama said.
The term of the loan has been fixed for 20 years including a grace period of five years. The interest rates for the loan has been fixed in accordance with ADB's lending facility based on the London Interbank Offered Rate, and a commitment charge of 0.15% per year.