Govt, ADB enter US$250m road agreement

The loan will help finance the construction of 6,254 km of all-weather rural roads in the Indian states of Assam, Chhattisgarh, Madhya Pradesh, Odisha, and West Bengal under the Prime Minister’s rural roads program, the Pradhan Mantri Gram Sadak Yojana (PMGSY)

January 30, 2018

The program is aimed at improving connectivity and socio-economic opportunities for rural communities through improvement of 12,000 km of rural roads

The loan’s first tranche is part of the US$500 million Second Rural Connectivity Investment Program for India approved by the ADB in December 2017

The project builds on the US$800 million ADB-financed First Rural Connectivity Investment Program in 2012, which added about 9,000 km of roads in the states

Maintenance of the newly constructed roads will be ensured through the provision of a five-year post-construction maintenance in each civil works contract

The Indian Government has entered into a US$250 million loan deal with the Asian Development Bank (ADB) to fund rural road construction as per an announcement on January 30th. The financing will help build 6,254 km of all-weather rural roads in the states of Assam, Chhattisgarh, Madhya Pradesh, Odisha, and West Bengal under the Prime Minister’s rural roads program, the Pradhan Mantri Gram Sadak Yojana (PMGSY). The loan’s first tranche is part of the US$500 million Second Rural Connectivity Investment Program for India approved by the ADB in December 2017. The program is aimed at improving rural connectivity, facilitating more efficient access to livelihood, and socio-economic opportunities for rural communities through improvement of about 12,000 km of rural roads.

The programme will also support India’s drive to employ innovative approaches to reduce costs, conserve non-renewable natural resources and promote the use of waste materials in rural road construction. Additionally, road maintenance will be ensured through the provision of a five-year post-construction maintenance in each civil works contract. The project builds on the US$800 million ADB-financed First Rural Connectivity Investment Program in 2012, which added about 9,000 km of all-weather rural roads in the same states. In view of increased rainfall and storm surges in the project states, the road designs will take into account these climate risks with measures such as greater elevation of road embankments, slope protection, and better drainage in flood-prone areas.

Women were extensively consulted during the project design and will gain some key benefits, including improved access to healthcare, livelihoods, and schooling. Under the project, about 2,000 technical personnel would be imparted training on road safety and maintenance. The project comes amid the National Highways Authority of India’s (NHAI) plans to award 8,300 km of new road projects by the end of the current financial year ending March 31st, 2018. Projects for road length of nearly 2,700 km, costing US$6.7 billion have already been awarded by the Authority so far in the financial year 2017-18. The projects will help the Government’s ambitious “Bharatmala Pariyojana” connectivity programme that is targeting construction of a ambitious 34,800 km of new roads.  

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