Thursday, September 01, 2005 - World Bank to Lend $9 Billion to India - World Bank to Lend $9 Billion to India

Associated Press
August 22, 2005

NEW DELHI -- World Bank President Paul Wolfowitz on Saturday pledged loans of $9 billion during the next three years to India, which has one of the world's highest economic growth rates but is home to a quarter of the world's poor.

"India's success is important to the whole world. India inspires success in other parts of the world," Mr. Wolfowitz said at the end of a four-day visit.

"Though it's making rapid strides, India has an unfinished agenda," Mr. Wolfowitz said in a separate statement. "It is still home to a quarter of the world's poor people, most of whom reside in rural areas. Infrastructure constraints are an impediment to growth."

The bank's new lending of $3 billion annually for three years will help pay for roads, drinking water and irrigation facilities in tens of thousands of villages, according to the statement. Nearly 70% of India's more than one billion people live in more than 500,000 villages connected largely by dusty tracks, dependent on agriculture and forced to endure acute shortages of drinking water and electricity. Many cities have inadequate infrastructure that hasn't kept up with the economy's rapid expansion.

Nuclear energy is one of the tools India is seeking to propel faster economic growth. In July, the U.S. and India signed an agreement under which Washington is to share civilian nuclear technology and supply nuclear fuel.

However, Mr. Wolfowitz said the World Bank hadn't made up its mind on lending for such projects world-wide.

Mr. Wolfowitz said India's booming economy likely will do even better if the country continues its 15-year-old economic overhaul.


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