PARIS: The aid India consortium of international donors Friday pledged a substantial assistance of 6.7 billion dollars including the vital fast-disbursing immediate balance of payments help of 2.3 billion to meet the country’s import needs.
The pledges of 6.7 billion dollars an increase of 6-7% over the last year’s level by 13 countries and several international financial institution is significant of the support to India’s far-reaching reform Program initiated by the Narasimha Rao government especially at a time of severe liquidity crunch and commitments elsewhere
The aid club’s pledges include 2.2 billion dollars from bilateral sources and the remaining 4.5 billion from multilateral sources.
Of this as high as 2.3 billion dollars is in the nature of fast-disbursing assistance on concessional terms or in the form of grant.
This is perhaps for the first time that the consortium has accepted India’s plea for fast-disbursing assistance. About 50% of the 700 million dollars fast-disbursing assistance from bilateral sources has come from Japan and the rest is mainly contributions from Germany Britain and Netherlands.
The 1.6 billion dollars’ worth of fast-disbursing help from the multilateral sources is the contributions mainly from World Bank and the Asian development bank. Briefing newsmen after the two-day meeting the leader of the Indian delegation the finance secretary S P Shukla said besides the total pledges some donor countries particularly Japan indicated their willingness to meet any further exceptional financing needs should the need arise after the IMF stand-by credit arrangement was in position.
He said on the whole the conclusions reached at the consortium meeting “fully meet India’s expectations”.
Shukla said the initial requirements projected in the country’s economic memorandum of the World Bank particularly the unabridged exceptional financing gap have been fully met by the pledges made on behalf of the multilateral institutions and the donors.
The overwhelming support by the donors and multilateral institutions shows the abiding confidence and commitment of the international community in the success of the macro-economic stabilization and structural reform measures initiated by India he said.
The finance secretary said the level of pledges and the fast disbursing nature of assistance should send a strong message to investor’s capital and financial markets of the strong support to India by the international community and their commitment in meeting the transitional problems by way of balance of payments support.
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