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ADB grants $350 mn loan for power project in Madhya Pradesh

By Religare

ADB grants $350 mn loan for power project in Madhya Pradesh
The Government of India and Asian Development Bank (ADB) on Tuesday signed a USD 350 million loan for selective transmission and distribution system improvements critical for meeting the growing demand of power in Madhya Pradesh.

The project will carry-out physical upgrades to increase capacity and deliver power more efficiently. It will fund about 1,800 circuit kilometers of transmission lines and more than 3,100 circuit kilometers of distribution lines, as well as building or upgrading transmission and distribution substations.

Madhya Pradesh, whose economy is growing at a quicker rate than the national average, is expected to see its demand for electricity rise by about 11 per cent a year between fiscal years 2013 and 2017, resulting in a potential transmission and distribution capacity gap of about 20 per cent.

The loan from the ordinary capital resources of ADB has a 25-year term including a grace period of 5 years, commitment charge of 0.15 per cent per year (on un-drawn balance), Maturity Premium of 0.10 per cent (by straight line method) and interest rate to be determined in accordance with ADB's LIBOR-based lending facility.

Dion Global Solutions Ltd.

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