Announcement of India to Develop Hydropower Resources in Karnataka State on May 12, 1988

FOR IMMEDIATE RELEASE 'NorldBank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 88/69 Contact: Richard Kollodge (202) 477-4507 INDIA TO DEVELOP HYDROPOWER RESOURCES IN KARNATAKA STATE WASHINGTON, May 12, 1988 -- India will reduce electricity shortages in Karnataka state with a $570.1 million project that will develop the country's hydropower resources. The World Bank is supporting the project with a $260 million loan. Frequent power outages in this southwestern state have resulted in losses in industrial production, while sudden changes in voltage often result in damage to machines and other equipment. The World Bank loan will help the the Karnataka Power Corporation (KPC) to construct a 240 megawatt power station--the Sharavathi Tailrace Hydroelectric Scheme--which will include a concrete dam and a powerhouse with four generating·· units. The KPC will also repair the Talakalale dam in the western part of the state. The loan will also help the Karnataka Electricity Board to construct power transmission lines and reinforce its distribution network. The World Bank loan is for 20 years, including five years of grace, with a variable interest rate, currently 7.72 percent, linked to the cost of the Bank's borrowings. It also carries an annual commitment charge of 0.75 percent on the undisbursed balance. Note: Money figures are in U.S. dollar equivalents.