ADB approves loan for Indian grid expansion
The Asian Development Bank (ADB) on Wednesday said it has approved a $346 million loan to the Indian government to provide reliable power connection in rural areas of Maharashtra.
Maharashtra is the second-most populous state in India, and about half of the state’s labour force is engaged in agriculture and related activities in the rural areas, ADB said in a release.
Agriculture output, however, has been impacted by lack of irrigation, less-than-efficient use of electricity and water, as well as inadequate storage and connectivity to markets.
The loan will support the state government’s high voltage distribution system (HVDS) program for new grid-connected rural agricultural customers across the state, said the Manila-headquartered multi-lateral funding agency.
“Providing efficient, reliable, and good quality power to rural agriculture customers in Maharashtra will improve agricultural productivity and efficiency in the electricity value chain,” said ADB Senior Energy Specialist Len George.
This first ADB-financed RBL program in South Asia’s energy sector will help in the early construction and installation of metered HVDS through the installation of about 46,800 kilometers of 11 kilovolt (kV) grid extension lines, construction and upgrading of 121 33/11 kV distribution substations.
The programme will also build institutional capacity in the Maharashtra State Electricity Distribution Company Limited (MSEDCL) on HVDS, it added.
The Maharashtra government and MSEDCL will arrange for counterpart funding of $357.1 million equivalent toward the $703.1 million total cost of the project, which will be implemented by the Maharashtra Energy Department and MSEDCL.
This program complements ADB’s Maharashtra Rural Connectivity Improvement Project and Maharashtra Agribusiness Network Project to promote economic growth and private sector development in rural Maharashtra.
This loan will be accompanied by a $1 million technical assistance from ADB to demonstrate energy and water conservation efforts, the funding agency said.
Source: Outlook India
Photo (for illustrative purposes): Electric Power Pylon / Bishnu Sarangi / Pixabay / Free for commercial use
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