Announcement of Loan Granted to India on January 26, 1953

·····v .Holl>. FM REI.EASE HOID FOR RELFASE lN'l'ERNATIONAL BANK FOR RlOOONS'lROOTIOM AND DEVELOPMENT ··.FOR THE PRE$ FOR RELEASE lO A.M. Monday PRE$ RELF.ASE NO. 31S ;, January 26., 19S .3 The International Bank for Reconstruction and Development today announced a loan of $19.,SOO.,OOO to India for the further development of the Damodar River Valley1 which is India• s most important, industrial area. The lQan will help firum~e the construction of pro,j ects designed to protect this area against floods., to expand electric power capac~tY. and.-,to build cazmls for irrigation and tr&hs- ~· portation. These are k~ projects in a general plan_ for the development of the Damodar Valley~ Th"· Bank is already helping to finance t~ee other major projects in the 11 )', program. A loan <?f $18,Soo,ooo was made in April 19.$0 for a s:team power plant at ~o~~0-1,_ ~ J?..~er . tta!)smission system., and a storage dam at Konar. The steam power plant with an initial capacity of 1.$0.,000 kw. will be the largest in India and is expected to be ready for complete operation by May of tM,s year.. The Konar dam should be completed by July. The loan made today will be used for a ~~ond group of· projects within the program. These projects are two multi-purpose dams, each with a hydroelectric plant1 and an extensive irrigation system, including~. diversion dam on the Damociar River. The largest of the canal~ will be constructed to carry barge traffic. , r:----', The Damcxiar Valley with it,, surrounding area is the most highly developed indllstrial region in India. In it are situated India's two largest iron and steel .plants 1. her largest fertilizer plant, the Government• s locanotive works., and cement works. The area also contains India's richest mineral resources, including three-quarters of the coal reserves and large deposits of iron ore., be;;11Xite and other v,aluable minerals. Adequate supplies of power., added to the considerable • natural re~ources., will attract new industries to the area and permit the expansion  a .. 2 • ••• ot existing ones'~ The n~ hydroelectric power plants will have an installed capacity totaling 100,000 kw. and will complement the l.S0,000 kw. ·to be generated by the Bokaro steam plant. The additional power is eJq>ectecl to meet, thrQugh 19$9, the needs of the area now being served. Work. has already started on,, th• i~igation system; it will include 1,sso miles of irrigation and drainage ~anals serving an area or one million acres in :I West Bengal. When fully developed the system should mak,~ possible the production or an additional 400,000 tons of foodgrains., mostly rice. An increase in food production is or particular importance ;~n this densely populated area as it is chronically defi~ient ill food. The two multi-purpose dams will be used primarily for flood control. F:I.ood$ - - -·· nave in 'the past done considerable damage to crops and urban property in the Valley • • !n 1943, when the most disastrous flood of recent times occurred, the value of crops lost was estimated at $16 million. Apar~ from the savings from the prevention or flood damage, the elimination of this danger should be an additional factor in (1 encouraging industrial and agri~ult ural investment. The main irrigation canal will be 80 miles long an:l will connect the Damodar River with the Hooghly River 30 miles upstream from Calcutta. The use or barges · on the canal will relieve then over-burdened railways and provide a cheap means of transporting coal and other goods between the V~~ley and Calcutta. The total cost ot the projects for which today, s loan· of $19.$ million was made., ill'l Pd.imp.t.Ai at the equivalent of $103 million. The local curr·ency costs and the foreign exchange needed iii it.ddition to the Ba~~s loan will be proVided ' by th, Goverrmient of India and t1'e State Governments of West BengaJ.. ?hd Bihar. \' The Bank's loan will be used to pay f'or imported m;i.tex·ials and ·equipment for powerhouses, dams and barrage; ·earth-moving machinery; and engineering services. ;o o Tl'le plan for the development of the'' Damodar Valley had its origin in a schS11,e for flood control, initiated shortly after the flood or 1943, arxi was later expanded to include the general development of the Valley. The Da.JOOdar Valley Corporation, modeled on the Tennessee Valley Authority, was established in 1948 to carry out the plan. In addition to i.ts two loans for cproj ects to be carried out by the Corporation, the Bank has lent $31.S million to expand the output of the Indian Iron and Steel Company, Ltd., a private company -w;hose works are situated in the Valley. Other Bank ~oans in India have been $32.8 million for railway rehabilitat,ion and $7 .$, million for ag;ricultural machinery. The total or Bank lending in India is now $109.8 million. Today's loan i$ fo-.r a term of 2S years and bears interest of 4-·7/8% including the 1%·:co1flltiis5ion which, under the Bank's Articles of Agreement., is allocated to • the Speciaf Reserve. Amortization payments will begin .on July 15, 1956. After being approved by the Bank's Executive Directors o~ January 23, the Loan Agreement wa.s signed by His Excellency G. L. Mehta., Indian Ambassador to t the.United States., on behalf of the Government of India., and by Eugene R. Black., President., on behalf pf the International Bank for Reconstruction and Development. \.\ A Project Agreement, containing certain covenants by the Damodar Valley Corporation relating to the construction and operation of the project, was ~igned by Mr. s. ?l. Mozumdar, Chairman, on behalf of the Corporation, and by Mr. Black on behalf of the Bank • •  C> <) \i • :),\ ···co •l--Jl V, \: T,·m,·,·)'T!' L:d.N :r, ... 01'-~L D:t;' .._;J.1.,~·,4-i,(1'l J. Ui. .1.'.1 1 1 \: < RECON3TRUCCI0N\Y FOUENTO \( 1 , : i,ashington,i, D. c. \\ \\ \ (' PARA PUBLICACION ' ' \ \ i', ;, en la aafiaria del 15 de enero 19SJ \\ t) ' \\ :c-~ El :Janco Internaciral de Reconst:n1ccd:6fi y Fomento am.inpiO hoy el 'comienzo d e SU qu1nto 1 • programa ge\reral anual d e a di . t o. .. , t raml.en 1 \ e:~ L05' P~;t' t· . ._ 1;i,panveS en 1 ;~ el programa de 19;;7) proc~(iden de och? de 1\ I os \paises n~\errhros y son:~,. Edmund I • ,. " \\ I J Eramudugolla .,. de Ueilon, 8,hang \\ Chien Huang , de \China, AbduI Al-Hubaii r de Iraq, Alfredo Avil8s de ;jicarad1.a, l!aziruddin Ahmed .de Paquistan, Osc~r Ginebra Ii I !lentlquez de la itepUblica " f ominic~na, .Bug&nio Nie'lt'as Q.e la Re)";G.blica Filipina, \\ 1~ ,, . y A1<boon Vanikk1..ll de Tailai~dia. ,,, I\ \\ \1 El propo?i to del pro~~ama es ,dar una ouortunidad a los nacionales de los \\ ~ \~'·, t u , . b (! \\ # \~ • : paises ruem :ros, cuyas carre:ras estan relacionadas con el trabajo del Banco, de '11 ,, : , familiarizarse con todos loS\. as15e ctos de su funci\\'.ima:~iento )l operaciones. Lps i\ escogidos tendran opo:;,"\unidad de 1.irer directamente 1,como est~ orga:h:i.iado ~:1 Banco ,-, l.. ·\ I 0 y como se administra, como hace prestamos, c6mo lan?la e~isione~ de bones al I mercado_; los varios netodos quo US.:\, al proporci6nar asistencia te,_cnica, al cl.e- 'linear progr.:1mas de fomento de largo alcF.!.nce y al analizar los proyectos que· se le presentan. EJ. programa busca que la experiencia reci bida en el Banco ayude a que los i:,articipantes contribuyan mas ei'ecti vamente al crecimiento economico de SUS propiOS pai~es. El grupo de 1953 fue escogido entre cerca de 100 solicitantes.,, la raayori.a: de los cua1es fue presentada por funcionarios de los paises miernbros. Su se- leccion por el Banco se bas6 en lo$ meri tos individuales, y despues de un examen meticuloso de sus calificaciones. Las personas escogidas este afio, como • en los a1t/ter[~es1 tienen entre 20 y por ,lo me,n~: al grado de bachiller de un colegio bien conocido" y se han es- pecializado en finan,as, econom!a o banca" JS afios y pcseen un ti tulo equi valente .  - 2 0 // Durante 1 a primera :-x;.r t e d J programa., 1 ~ e. . os escogi os · ct • t· g.Sl.. s , Ill. ira:r\\ a conJ.e- ~ , . \., rend.as y se:.d.n.1rios s-obre la historia., los pro-r)osi tos, la organizac~on y la i? pcll.tica del Janco... .Jesr>ues haran est:udios es~ecificos de casos nislados· de las operaciones del Dallco con algunos de los pdses .ri.em:.,ros con el objeto :: , , . qe familiarizarse con lcs prot.le:mas es·:-,e¢ificos del desarrollo econoi'.t1.co ·:r:- Ii como e.l Bar.co ay·qaa a resolverlos. Dhrante ~! 1:..\ E1ayor - :Jarte clel .~n"'ogrr.una, los , (' d r participant.es seran asignados a varios departamentos qel 3a11co pa1.. a que ob- tengan experiencia practica. 0 El pro[:rama de adiestrami.ento fue inaugurado por el B~:ico en 1949 y con // el grupo de este afio. se han .selecc:i-onado ,ya .individuos de 35 de los paises ,, ·,liembros, a saber, Australia, Austria, lli., gica, el Can~.da, Ceilon, Chile, . (( China, Dinamc1rcc1,, el ;_;ct~ador·, .~gi;Jto, los :'.::~stados Unic-.os ,. F:Lnlandio., Francia, • Grecia, Gud.e:nala, India, Iran, Irr.10., Isl:mdia, Italia, Libano, :..iexico, dic:lragua, Iforuega, los Paisos Jajos, el .:\.eino Unido, la :~epublica Do;:tl.nicana, la Hepuhlica iili:,ina, Siria, Tailandin, Tm... qu!a, J a Urri.-5n Sudafricana y \) Yugooslavia. A continuacion se da umt breve bior;raf:fu de 11los seleccion:.ido:i; de la A:-.1erica Latina: Nicaragua , 4 Alfredo Aviles, de i'iianagua .r gradu.ado de la Uni versidad de Loyola de Los u.:i:1geles, e~1 : 'J50. De·~de e:ntonces ha sido a;;ru.dante .:ii-·incipal en el Dep:~J.'"ta111ento 1..le Com1]l"Gio., Industria y Minas del i·ill.nis terio de -Jcoi.-,.r- 1u.a. 1 Republica Oscar GinGbra henr!c;uez recibio st... errodo de doctor en leyes en 0 Dominicana la Universidad de Santo Dor.lingo en 1946. Desde 1947 ha sido a}rudante del Director de Investig-:lcionns Econonicas en el Banco Central en Ciudad T1..u.jillo • •