Centre-ADB sign $141 million loan pact to develop 3 industrial corridors in Andhra Pradesh

Andhra Pradesh will use the loan to develop high-quality infrastructure such as roads, water supply systems and electricity distribution network in three industrial clusters.

New Delhi: In order to give a major fillip to infrastructure development in three industrial corridors in the southern state of Andhra Pradesh, the Government of India signed a $141.12 million loan agreement with Asian Development Bank (ADB). The loan received from Manila based Asian Development Bank will be used in development of high-quality infrastructure such as roads, water supply systems and electricity distribution network in three industrial clusters in the state of Andhra Pradesh.

The new loan facility is the second tranche of the $500 million multi-tranche financing facility (MFF) for the program approved by the ADB in 2016 to build infrastructure in three industrial corridors in Andhra Pradesh. These industrial clusters are being developed in Visakhapatnam and Srikalahasti-Chittoor nodes in the state.

Loan to boost manufacturing sector in AP-According to the finance ministry officials, the ADB financing will help the state of Andhra Pradesh in promoting industrialization. The loan amount received from the ADB will be used to increase the share of the job intensive manufacturing sector in the state that will boost the state’s gross domestic product (SGDP). It will help the state to build competitiveness and create employment, they said.

Officials said the financing will help strengthen industrial infrastructure in Visakhapatnam node with the development of internal infrastructure in the start-up area of the 160-hectare Rambilli industrial cluster and of around 441 hectare area in Nakkapalli industrial cluster.

This will include widening of 13.8 kilometer of the Atchutapuram to Anakapalli road and improvement of 4.4 kilometer access road to the Nakkapalli cluster. According to officials, internal infrastructure that will be developed in these proposed industrial clusters will include internal roads, storm water drains, water supply systems, and electric power distribution systems, among other things.

For example, in Srikalahasti-Chittoor node, the project will help develop the start-up area of the 938 hectare Chittoor South industrial cluster. The loan amount will also be used in development of a 9.5 kilometer access road to the Chittoor South industrial cluster and an 8.7 kilometer access road to the Naidupeta industrial cluster.

AP emerging as automobile hub-After the bifurcation of erstwhile Andhra Pradesh into Andhra Pradesh and Telangana in 2014, the state has been trying to attract the industry by developing dedicated industrial corridors. The state is fast emerging as an automobile hub after Chennai and already has several leading auto companies operating their plants in the state. These include Ashok Leyland, Hero Motors and Kia Motors among others.

The project will support the state in rolling out an updated marketing action plan for investment promotion, and enhance skills of people including the socially and economically vulnerable section, said the officials.

Sustainable infrastructure-In order to tackle extreme weather conditions experienced in the state, the project will also help in establishment of a green corridor model operational guideline and develop a disaster risk management plan. For long term sustainability, the program will formulate a plan to improve operation and maintenance of start-up industrial clusters, and will roll out a toolkit with gender-responsive and socially inclusive guidance.

It will also integrate industrial and urban planning including industrial housing in the nearby areas of these three industrial clusters in the state.