Asian Development Bank (ADB) has approved USD 620 million loan to boost irrigation projects in Madhya Pradesh and supply clean water in West Bengal.
ADB inked USD 375 million loan agreement with the Madhya Pradesh government that will be used to contribute to double farming income by expanding irrigation networks and system efficiency, the multi-lateral funding agency said in a release.
Separately, the board of directors of ADB approved a financing package of USD 245 million to provide safe, sustainable, and inclusive drinking water service in West Bengal.
This is expected to benefit about 1.65 million people in three districts of West Bengal affected by arsenic, fluoride and salinity.
The Madhya Pradesh Irrigation Efficiency Improvement Project will develop 1,25,000 hectares (ha) of new, highly efficient and climate resilient irrigation networks, and improve water use efficiency in more than 400 villages, benefiting over 8 lakh people in the state, ADB said.
Sameer Kumar Khare, Joint Secretary (Fund Bank and ADB), Ministry of Finance, and Sabyasachi Mitra, Deputy Country Director of ADB's India Resident Mission, have signed the loan agreement.
A separate project agreement was signed by A K Upmanyu, Project Director, on behalf of the Madya Pradesh government.
"The ADB funds will be used to develop a large-scale pressurised and automated irrigation system for boosting irrigation efficiency," said Mitra.
The project will help Madhya Pradesh sustain its extraordinary growth in the agriculture sector through support to the state government's irrigation expansion and modernisation plan by maximising irrigation efficiency and water productivity, Khare said.
On West Bengal loan, ADB said more than 90 per cent of the rural population relies on groundwater, making it home to about 72 per cent of India's population at risk from arsenic and 5 per cent of the population at risk from fluoride contamination.
The project will provide continuous potable water through metered connections to about 3,90,000 individual households in Bankura, North 24 Parganas, and Purba Medinipur.
"High arsenic and fluoride levels in drinking water are a threat to public health in India, where West Bengal is by far the worst affected state," said ADB Principal Urban Development Specialist Neeta Pokhrel.
Through efficient use of surface water and a shift to piped water schemes, the ADB project will reduce the burden of disease from arsenic and fluoride, while preserving groundwater and enhancing climate resilience, she said.
The total project cost is USD 349 million, for which ADB will provide a loan of USD 240 million and grant of USD 3 million from the Japan Fund for Poverty Reduction.
The West Bengal government will provide USD 106 million funding. ADB will also administer a USD 2 million grant from the Urban Climate Change Resilience Trust Fund.
The project is due for completion in June 2024.