Announcement of India NTPC Power Generation Project on July 1, 1993

FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. *Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 93/113 Contact: Gautam Adhikari Tel: (202) 458-1423 INDIA: NTPC POWER GENERATION PROJECT The following is additional information about a project announced in the latest issue of World Bank News. DATE: July 1, 1993 WORLD BANK GROUP SUPPORT: World Bank loan: $400 million. The World Bank loan is for 20 years, including five years of grace, with a variable interest rate, currently 7.43 percent, linked to the cost of the Bank's borrowings. It also carries an annual commitment charge of 0.25 percent on the undisbursed balance. TOTAL COST: $400 million IMPLEMENTING AGENCY: National Thermal Power Corporation (NTPC) ESTIMATED COMPLETION DATE: 2002 PROJECT DESCRIPTION: The objective of the NTPC Power Generation Project is to support India's reform program for the power sector. Specific objectives are to (a) improve commercial discipline in the power system through the implemen- tation of new commercial policies and investment policies; (b) help NTPC meet its targets for capacity additions through increased mobilization of funds from internal resources, domestic, and foreign capital markets as well as from the private sector through joint operations; (c) upgrade environmental performance of NTPC power stations and make its new power stations environmen- tally more sustainable; and (d) strengthen its environmental and resettlement and rehabilitation management capability. The project includes three compo- nents: (a) generation capacity additions, a five-year time-slice of NTPC's least-cost investment program of new coal- and gas-based power stations for which full funding has not yet been arranged; (b) a private-sector component consisting of support to NTPC to undertake several joint venture operations; (c) an environmental strengthening and resettlement and rehabilitation component which includes environmental upgrading projects, training, and technical assistance for strengthening NTPC's environmental management and resettlement and rehabilitation capability and the implementation of the Environmental Action Plan. The World Bank Loan of $400 million is the first of a series of three operations to support NTPC's investment program which will be proposed for consideration by the Board of Executive Directors at intervals of 18 to 24 months for a total of about $1.2 billion, provided that NTPC remains in compliance with the Bank's legal conditions.