Announcement of India Powergrid System Development Project on March 25, 1993

FOR IMMEDIATE RELEASE Wvorld Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. *Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 93/69 Contact: C.L. Robless Tel: (202) 458-2860 INDIA: POWERGRID SYSTEM DEVELOPMENT PROJECT The following is additional information about a project announced in the latest issue of World Bank News. DATE: March 25, 1993 WORLD BANK GROUP SUPPORT: World Bank loan: $350 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: $764 million OTHER PROPOSED FINANCING: Other borrowings, $233 million; Power Grid Corpora- tion of India (POWERGRID), $153 million; State Electricity Board, $24 million; Overseas Development Administration, $3 million; Asian Development Bank, $1 million IMPLEMENTING AGENCY: POWERGRID ESTIMATED COMPLETION DATE: 2000 PROJECT DESCRIPTION: The objectives of the Powergrid System Development Project are (a) to assist the government of India in restructuring the power transmission subsector, improve coordination in system operations, and promote inter-regional and inter-state power trading through regulatory, tariff, and institutional reforms; (b) to support POWERGRID's institutional development and help introduce satisfactory financial performance targets and commercial arrangements; and (c) to assist POWERGRID in the development of modern system coordination and control facilities and reinforcement of its transmission system by financing selected components of POWERGRID's investment program. The project consists of three parts: Part A, System Coordination and Control, provides for (a) the implementation of a coordination and control system for the Southern region; and (b) the preparation of similar systems for the Eastern, Western and North-Eastern regions. Part B, Transmission System Reinforcement, provides for (a) the strengthening of POWERGRID's transmission system in the Southern and western regions; (b) the completion of the Central Power Transmission Project (Ln. 2283-IN) and the Rihand Power Transmission Project (Ln. 2555-IN); (c) transmission planning support and preparation of POWERGRID's future transmission projects; and (d) the installation of tariff meters. Part C, Technical Assistance helps implement India's reform program for power transmission and system operations and supports POWERGRID's institu- tional development.