TOKYO: Japan Thursday said it would soon announce plans to bail India out of its current short term balance of payments crisis by joining in the Asian development bank (ADB) to co-finance Projects in India’s energy sector. Japan’s finance minister Ryutaro Hashimoto told his visiting Indian counterpart Yashwant Sinha that Japan fully understood India’s difficulties and was taking initiative to convey the world financial community to do its utmost to help India out of a problem that is not of its own making.
The minister explained that Japan would offer another sizeable amount in a second similar co-financing project in aid of India.
Japan’s own contribution to the two schemes is expected to be half a billion dollars. India’s target is a billion dollars from Japan and other sources But Japan was taking care of about half a billion sources close to the Mr Sinha’s meetings with the Japanese finance and foreign ministers here told PTI.
Sinha was assured of all help possible Japanese finance minister Hashimoto as well as foreign minister Taro Nakayama told him that Japan would match the ADB’s 150 million commitment made on April4 to India’s energy sector development within this month.
In other words Japan would put up another 150 million dollars for the same ADB financed project.
A much larger amount possibly 300-350 million dollar would be Japan’s contribution to another co-financing scheme to be finalized at the half early meeting of the world bank also this month in Washington where Japan would pull other major donor countries into providing support to India’s current financial need. This aid should be available to India before June.
Both Nakayama and Hashimoto explained that Japan decided upon co-financing of existing or running projects as there was no time to examine new projects which have to come first before the World Bank sponsored annual aid consortium meeting in Paris. But there was no time for it.
They told Sinha their strategy should act as a powerful signal to other donor nations and world financial community to come to the assistance of India.
The Japanese ministers also assured him they did not regard India’s current cash problem as having anything to do with India’s current cash problem as having anything to do with India’s economic fundamentals which seemed to them quite sound considering India’s continued growth in both industrial and agricultural sectors. Nor did they doubt India’s political stability the two Japanese ministers said.
Article extracted from this publication >> April 19, 1991
