India, Japan sign pact for 50-bn yen loan to support poor hit by Covid-19

The Japanese embassy said that the loan was aimed to help the Government of India provide support to vulnerable groups, including the poor and women, who had been severely affected by the economic slowdown caused by the pandemic.

India and Japan on Friday signed an agreement for a loan of up to 50 billion yen (about ₹3,550 crore) to back New Delhi’s economic support programmes for the poor and vulnerable affected by the Covid-19 crisis.

The financial support aims to support the Indian government’s programmes such as Pradhan Mantri Garib Kalyan Yojana (PMGKY) (REUTERS)

CS Mohapatra, additional secretary in the department of economic affairs and Japanese ambassador Satoshi Suzuki signed the agreement in New Delhi for the loans with an interest rate of 0.65% per annum and a repayment period of 15 years, including a five-year grace period.

Japan had earlier provided budget support of 50 billion yen and grant assistance worth one billion yen (about ₹71 crore) to support the Indian government’s efforts to counter the Covid-19 crisis.

The Japanese embassy said vulnerable groups, including the poor and women, had been severely affected by the economic slowdown caused by the pandemic.

“This loan provides the necessary funds for the government of India to implement economic support programs for the poor and vulnerable and policy reforms, including but not limited to health and medical sectors, which are essential in the fight against Covid-19,” the embassy said in a statement.

“It is expected that these measures will contribute to a more stable and sustainable socioeconomic development in India,” the statement said.