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WB to give Rs 120 bn loan to Karnataka

The World Bank has agreed to give a Rs 120 billion ($ 2.5 billion) loan-cum-grant to Karnataka for various schemes including infrastructure development over the next five years, Chief Minister S M Krishna disclosed in Bangalore today.

He said the World Bank assistance would be in the form of 70 per cent loan and 30 per cent grant. The rate of interest was 12.5 per cent. A portion of the assistance would go towards poverty alleviation programme and it would be treated as soft loan.

Krishna was speaking to newsmen after returning from Davos in Switzerland where he had attended the World Economic Forum's summit.

Explaining the details of the development programmes under the assistance, he said 60 per cent of the loan -- amounting to Rs 75 billion, would be spent for various rural projects such as drinking water supply schemes, ground water recharging, watershed development, primary education and power sector reforms.

The assistance was the outcome of a meeting between the chief minister and the World Bank team led by its president Edwin Lim soon after Krishna returned to the city.

Replying to queries, Krishna said he was confident of attracting investments from foreigners as a follow up of his visit abroad. He held a series of one-to-one meetings with chief executives of various multinational companies during his visit. Some of them had promised to send delegations to the state, shortly for further discussions.

Prominent among them was Prakash Paul, son of Lord Swraj Paul of Caparo, based in Britain and Kenneth L Lay of the Enron Company. The offer of Enron for laying LNG pipeline was still open before the government, he added.

UNI

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