New Delhi (ABC Live India): The government of India and the New Development Bank (NDB) today signed a loan agreement for lending $1,000 million for ‘supporting India’s economic recovery from COVID-19’ by supporting expenditures on rural infrastructure related to natural resource management (NRM) and rural employment generation under Government of India’s Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS).
New Development Bank Sanctions $1,000 million for Aatma Nirbhar Bharat Abhiyan
New Delhi (ABC Live India): The government of India and the New Development Bank (NDB) today signed a loan
agreement for lending $1,000 million for ‘supporting India’s economic recovery
from COVID-19’ by supporting expenditures on rural infrastructure related to
natural resource management (NRM) and rural employment generation under
Government of India’s Mahatma Gandhi National Rural Employment Guarantee Scheme
(MGNREGS).
The country-wide restriction on
movement of people, coupled with additional stringent restrictions imposed by
State Governments and intermittent localized lockdowns to contain the spread of
COVID-19, affected domestic supply and demand, resulting in slowing down
economic activity. This resulted in the loss of employment and income of workers
especially those employed in the informal sector, including rural areas.
The programme will support the Government
in mitigating the adverse economic impact of the COVID-19 pandemic and enable
economic recovery in the rural areas through:
- natural resource management
works which will facilitate economic activity and
- employment generation to
stimulate rural demand, to combat the decline in economic activity due to the outbreak of COVID-19.
The programme proposes the creation of
durable rural infrastructure assets relating to NRM and generation of
employment opportunities for rural poor, especially migrant workers who have
returned from urban areas and have lost their livelihoods due to the COVID-19
pandemic.
The agreement was signed by
ShriBaldeoPurushartha, Joint Secretary, Department of Economic Affairs,
Ministry of Finance, on behalf of the Government of India and Mr. Xian Zhu,
Vice President, Chief Operations Officer on behalf of the NDB.
ShriPurushartha said that the
programme will improve the livelihood of rural poor along with providing income
opportunities to migrant workers who have returned from urban areas because of
job loss caused by the COVID-19 pandemic.ShriPurushartha further added that NDB’s
timely assistance will help the Government in combatting the economic
disruptions caused by COVID-19 pandemic and creating employment opportunities
in rural areas to stimulate demand.
Mr. Xian Zhusaid that the programme
will support the Government of India’s efforts in mitigating the adverse economic impact of the COVID-19 pandemic and enable economic recovery in the rural
areas through NRM works and employment generation. The funding under NDB’s
Policy on fast-track emergency response to COVID-19 will help preserve rural
income and sustain rural expenditure, resulting in increased demand that aids
economic recovery.
The NDB was established based on the
Inter-Governmental agreement among the BRICS countries (Brazil, the Russian
Federation, India, China, and South Africa) signed on 15th July 2014.
The purpose of the Bank is to mobilize resources for infrastructure and
sustainable development projects in BRICS and other emerging market economies
and developing countries. The $1 billion loans from the NDB has a tenor of 30
years, including a 5-year grace period.