Japan loans Rs 5,910 cr to India
The Official Development Assistance is the largest soft loan package extended by Tokyo to any country.
Japan on Friday agreed to extend about Rs 5,910 crores (155,458 million Yen) as Official Development Assistance for financial year 2005-06, to fund various projects in diverse sectors.
The ODA, the largest soft loan package from Tokyo to any country, represents a 15.6 per cent increase over the assistance extended last year.
The loan would be used to fund 10 projects in fields such as power generation, rural electrification, environment, forestry, water supply and sewerage, urban transport (including the Bangalore Metro Rail project) and port sectors, Hidenao Yanagi, Minister of Economic Development at the Embassy of Japan said today.
Notes to formalise the agreement were exchanged between Additional Secretary, Department of Economic Affairs, Ministry of Finance Ashok Chawla and Ambassador of Japan to India, Yasukuni Enoki.
The rate of interest on the loan would be 1.3 per cent annually for the general projects, except the rural electrification project, and 0.75 per cent per annum for the environment sector projects.
The repayment period is 20 years with a grace period of 10 years for the general projects, and 30 years (after the grace period of ten years) for the environment and forestry sector projects.
For rural electrification project, the rate of interest would be 0.75 per cent per annum and the repayment period will be 10 years (after the grace period of five years).
Japan had provided 134,466 million Yen (about Rs 5,109 crore) for projects in FY 2004.
Currently, 38 projects are being implemented in the country with Japanese loan assistance.