Health-care facilities and the road sector will get a boost with the signing of an agreement between the State government and the World Bank for further strengthening the key sectors.

Two loan agreements — Rs.627.72 crore for the Tamil Nadu Health Systems Project and 281.67 crore for Tamil Nadu Road Sector Project — were signed at the Secretariat on Tuesday in the presence of Chief Minister M. Karunanidhi.

This additional finance for the Tamil Nadu Health Systems Project is designed to improve quality of and access to health services. It was first approved on December 16, 2004, with an IDA credit amount of $110.83 million.

For the road sector, the funding is additional financing to the Tamil Nadu Road Sector Project, which became effective on October 31, 2003, with a loan of $348 million. Thus far, the project has improved around 850 km of roads and upgraded 570 km of existing State highways to two-lane roads.

Representatives of the Centre, State and the World Bank signed the agreement. The project has been designed to improve quality and sustainability of the core road network in Tamil Nadu. A Credit Agreement was also signed on Tuesday.

Road transport, accounting for about 80 per cent of freight and passenger trips, is the dominant mode of transport in the State.

Demand for road transport has increased rapidly, with vehicle registrations growing by about 10 per cent annually since 2000. However, infrastructure has not kept pace with the demand, leading to serious network deficiencies.

About 20 per cent of the State highways and major district roads are in poor condition.

By the time the project is completed, 1,380 km of roads will be improved and another 720 km upgraded to two-lane in the core Tamil Nadu network.

In addition, the project will enhance road safety by improving several accident-prone locations and achieve better management of the network through strengthening of the operational capacity of the Highways Department.

The additional loan from the International Bank for Reconstruction and Development has a 25-year maturity, including a 5-year grace period.