Multilateral funding agency Asian Development Bank on Thursday approved $200 million (about Rs 940 crore) loan to finance a road project in Jharkhand.
“ADB Board of Directors approved a loan of $ 200 million to finance a 311-km, two-lane road that will connect the state’s (Jharkhand) northern region to the national highway network,” a ADB statement said.
The project will also build capacity in the state’s Road Construction Department, which suffers from shortage of engineers with road-building project management skills.
“Jharkhand is behind most other Indian states in terms of road connectivity, and that means high transportation costs and long travel times even for short distances,” ADB South Asia Department Principal Transport Specialist Hideaki Iwasaka said.
“This project means that travel time and costs will be reduced by as much as half, which will provide better access for local communities... and also encourage industrial development,” he added.
ADB’s loan covers 83 per cent of the total project cost of $ 240 million. The loan has a 25-year term, including a grace period of five years. The government will cover the remaining cost of $ 40 million (about Rs 188 crore).
The project will be executed by the Road Construction Department and is likely to complete by June 2014.