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World Bank Sanctions Rs. 925 Crore Loan For Second Phase Of Kerala Reconstruction – The New Indian Express

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Express news service

Two years after approving $ 250 million in aid for the first phase of the Rebuild Kerala Initiative (RKI), the World Bank approved $ 125 million in aid for the second phase of RKI. A meeting of the executive directors of the bank held in Washington on Thursday approved the state government’s project proposal and sanctioned $ 125 million (approximately Rs. 925 Cr). The loan will be financed under the results financing program, which means that the amount will be sanctioned for specific development projects approved by independent evaluators.

With WB authorization for the project, the way is also clear for a $ 125 million loan from the Asian Infrastructure Investment Bank. The second phase of the project designed after the devastating floods that hit Kerala in 2018 will receive a major boost with financial assistance of Rs. 1850 Cr reaching here from both shores. Discussions with AFD, the French Development Agency, for a loan of 100 million euros (approximately Rs. 880 Cr) are also underway. The BM loan has a repayment term of 14 years with a grace period of six years.

The objective of the Rebuild Kerala initiative is to integrate disaster risk planning into the master plans of local and urban communities self-reliant and to help make the departments of health, water resources management, agriculture and work that is more resilient to disasters.

“In the current context of increased economic, climatic and health shocks, strengthening the resilience of economies is a political imperative,” said Junaid Ahmad, Country Director of the World Bank. “The Bank is therefore investing in the capacity of Kerala to respond to shocks to the state economy and, most importantly, to prevent as much as possible the loss of lives, assets and livelihoods. The objective is not to fund programs but to partner with the government of Kerala to improve the financial health of the state; investing in sectors such as health, water resources, social protection and agriculture; and fight against the drivers of natural disasters,
climate change and pandemic risks, ”he said.

Rebuild Kerala Initiative CEO and Chief Supplementary Finance Secretary Rajesh Kumar Singh said AIIB approval for $ 125 million is expected soon. “We have already issued an administrative sanction for projects over Rs. 7,000 Cr and awarded work over Rs. 4,700 Cr,” Singh told TNIE.

In the first phase, the World Bank had given 250 million dollars while the German bank granted 170 million euros (approximately Rs. 2,215 Cr). The loan agreement for the first phase was signed with the World Bank in June 2019. The first phase of RKI helped the state draft a law on the conservation and management of river basins, which will conserve and regulate the resources. water and ensure their sustainable management, allocation and use. . It also introduced climate-resilient agriculture, risk-informed land use and disaster management planning.

The severity of the 2018 flood – which affected 54 lakh people and displaced 14 lakh people – was independently assessed by the World Bank before making the decision to support the Rebuild Kerala initiative.

“The groundwork laid during the first program improved the government’s ability to assess and respond to disasters. The new program aims to strengthen the state’s capacity to cope with potential shocks by integrating climate and disaster risks into planning and investment processes, ”said Elif Ayhan, senior risk management specialist. disaster and one of the World Bank team leaders to
the program.

KEY PROJECTS UNDER RKI – PHASE 2

  • One Health Platform: Establish a One Health IT platform that will strengthen coordination, joint surveillance and preparedness to counter future outbreaks.
  • Sustainable budget management: creation of a debt management unit within the Ministry of Finance to support government efforts to reduce its debt-to-GDPD ratio to a sustainable trajectory.
  • Disaster Risk Financing: Developing a Comprehensive Framework for Disaster Risk Financing; the creation of a unified database of vulnerable households for post-disaster safety net payments; pilot a modified crop risk insurance payment system and mobilize market-based resources to complement public disaster risk financing.
  • Climate Resilient Urban Development: To support risk-based urban planning, multi-year investment budgeting, and emergency management to scale up the state’s climate change adaptation and mitigation initiatives.
  • Resilient food systems: In addition to supporting agro-ecological zoning (ZAE) methods to promote agricultural systems resilient to climate shocks, the program will establish an integrated agricultural management information system for precision agriculture.
  • Climate-resilient road infrastructure: upgrade 400 km of the main road network through results-based and performance-based road maintenance contracts and establish a road maintenance management system to deploy climate-resistant designs and ensure an adequate budget.


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