Announcement of India Receives Three Hundred Fifty Million US Dollars in Loans from World Bank and IDA for Agricultural Credit on February 25, 1982

1/·1.MMEDIATE RELEA~E · . oWorldBank 1H 1 H H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 82/51 Contact: Hugh Blackman !DA NEWS RELEASE NO. 82/36 (202) 477-3879 February 25, 1982 INDIA RECEIVES $350 MILLION IN LOANS FROM WORLD SANK AND IDA FOR AGRICULTURAL CREDIT Institutions that 1end to farmers in India will be provided with financial resources and technical assistance through a combined $350 million loan from the World Bank and its affiliate for concessionary lending, the International Development A~sociation (IDA). The World Bank loan is for $190 million, the IDA credit $160 mi] 1 ion. The Bank and IDA money will help finance a two-year program--through December, 1983--under which $2,086.2 million worth of agricultural investments wiil be refnnanced. Lending by the credit institutions, such as land development and commercial banks, will be mainly for minor irrigation (including land development), and also plantations and horticulture, livestock, fisheries, markets, and storage facilities. A training program for the staff of the agricultural credit institutions 1s 1nc~uded in the program. Refinancing for the institutions that lend to farmers is the responsibility 0 of the Agricultural Refinance and Development Corporation,'(Shri Niketan, Dr. Annie Besant Road. Worn, Bombay 400018~ India, Cable: AGRIFINANS BOMBAY) .. Since 1969, the World Bank and its affiliate have made available to this refinance corporation a total of Sl.991 mi11 ion for 18 nroiects. The corporation provides finance for agricultural schemes it judges to be sound and within a reasonably compact area. It also helps to formulate such schemes, particu]arly in the less-developed Indian states. The project's primary objective is to increase agricultural production. At full development~ the annual value of the additional production is expected to be $680 million at 1980/81 farmgate prices. About 1.4 million farmers throughout India will benefit directly; about 60% will be small farmers. A permanent increase in employment is expected to be about 135 million man-days a year. The overall economic rate of return is expected to be 44%. The World Bank loan to India is repayable over 20 years including five years of grace, at annual interest of 11.6%. The IDA credit is repayable over 50 years including 10 years of grace; it is interest-free but carries a servire charge of 3/4 of 1% a year to he]p cover IDA administrative costs. NOTE: Money figures are expressed in U.S. dollar equivalents. ()