Asian Development Bank to help strengthen power distribution network in UP with $300 million loan
PHILIPPINES - FEBRUARY 11: The sign for Asian Development Bank (ADB) is displayed at its headquarters in Manila, the Philippines, on Wednesday, Feb. 11, 2009. Private companies in Asia risk being crowded out of debt markets this year as governments in the region boost bond sales to fund economic stimulus measures, according to the Asian Development Bank. (Photo by Nana Buxani/Bloomberg via Getty Images)
The Asian Development Bank (ADB) has agreed to disseminate $300 million loan to Uttar Pradesh Power Distribution Network Rehabilitation project to upgrade rural power distribution network. An agreement for this has been signed between Government of India and ADB and the signatories to the first tranche of the loan were the Country Director of ADB’s India Resident Mission, Takeo Konishi and Additional Secretary of Department of Economic Affairs in Ministry of Finance, C.S. Mohapatra.
Mohapatra said the upgradation of distribution network will help reduce aggregate commercial and technical losses and restore financial sustainability of rural electricity supply in Uttar Pradesh. Konishi added the project will have separate feeders for electricity supply residential and agriculture consumers and it will also strengthen financial management of power distribution entity in the state and improve rural area bill collection.
As per the agreement $430 million multi-tranche financing facility (MFF) has been approved as multi-tranche financing facility of which first tranche has been $300 million. In two tranches, conversion of 65000 kilometre of rural low-voltage distribution lines will be done to create a robust electricity distribution in the state. The project is expected to benefit about 70 million people living across 46000 villages.
There will be a feeder separation network to be established across 17000 Kilometre for domestic consumers and agriculture consumers and it will facilitate use of solar energy. The MFF is also expected to be complemented by a technical assistance (TA) grant of $2million from TA special fund of ADB and Japan Fund for Poverty Reduction meant for gender inclusivity besides strengthening the institutional capacity building of the state.
