World Bank-AIIB Sign Loan Agreement For Power Project
World Bank and Asian Infrastructure Investment Bank (AIIB) have together signed a $380 million loan agreement with the Government of Andhra Pradesh to help the state in providing reliable, quality, and affordable 24x7 power supply to its citizens.
The World Bank and AIIB will provide loans in a 60 to 40 ratio for all components of the project. The energy demand in Andhra Pradesh is expected to grow to 78,900 GWh (Gigawatt-hour) by FY 2019 from 56,313 GWh in FY 2015, which signifies an annual energy requirement of more than 8.5 per cent.
Raj Kumar, Joint Secretary, Department of Economic Affairs, Ministry of Finance said, “The project is part of the Government of India’s Power for All program launched in 2014. Andhra Pradesh is among a few states selected for the roll-out of the Power for All program. The energy demand in the state is expected to grow and substantial investments will be needed to meet this rising demand. This project will help AP improve its operational efficiency in the transmission and distribution sector so that it can provide reliable and affordable electricity to its citizens.”
The project will help bring in modern technology solutions such as automated sub-stations and network analysis and planning tools to provide reliable power supply and enhance customer satisfaction.
The $240 million loan from the International Bank for Reconstruction and Development (IBRD), has a 5-year grace period, and a maturity of 19 years. While a significant portion of the proposed investments are aimed at improving power supply to rural areas, the project will also focus on demonstrating the deployment of smart grids in selected towns.
The project named under `Power for All' program was launched in 2014 and Andhra Pradesh is among the few states selected for the rollout of this program.
