Announcement of India to Expand and Modernize Petrochemical Production on September 17, 1990

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. 9/14 Contact: Marjorie Messiter (202) 458-1353 INDIA TO EXPAND, MODERNIZE PETROCHEMICAL PRODUCTION WASHINGTON, September 17, 1990 -- To supply a growing domestic market, India will expand and modernize two of its largest petrochemical plants at Vadodara, in Gujarat State, and at Nagothane, south of Bombay. The World Bank is supporting the project with a $245 million loan. Petrochemicals are used in synthetic fibers,plastics, rubber, textiles and other products. Most of India's existing petrochemical plants use outdated technology and have not benefitted from recent advances in energy-saving processes. The project includes financing for a program to help establish markets for new products and to finance imports of key petrochemicals and derivatives until they can be produced locally. The project will also strengthen the capabilities of the Central Institute of Plastic Engineering and Technology to train engineers and other skilled personnel for the plastics industry. The design and construction of project facilities will include provisions to protect the environment and ensure operational safety. Other financing for the $587 million project will be provided by the Indian Petrochemical Corporation Ltd. and the Government of India. The World Bank loan is for 20 years, including five years' 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 0.25 percent on the undisbursed balance. Note: Money figures are in U.S. dollar equivalents.