Business

World Bank, ADB loan for Power Grid

NEW DELHI: Power Grid Corporation of India Limited (PGCIL) on Friday inked two agreements with the World Bank and the Asian Development Bank for two loans of $600 million each for funding various transmission projects across the country.

The PSU also signed a memorandum of understanding with the Power Ministry pegging a turnover of Rs. 5,400 crore during 2008-09, an 18 per cent rise over the previous year’s revenues. As per the MoU, the company targets to add about 5,500 circuit km of extra high voltage transmission lines and about 6,300 MVA of transformation capacity.

On the other hand, the loan from the ADB is a part of the bank’s newly introduced loan facility called multi-tranche financing facility (MFF). “An agreement for MFF has been signed with ADB for $600 million.

The MFF loan will be drawn in two tranches,” according to a PGCIL statement here. In the first tranche, ADB will lend $400 million.

The loan agreement for $400 million was signed by PGCIL Chairman and Managing Director R. P Singh and ADB Country Director (INRM) Tadashi Kondo in the presence of officials from the Finance Ministry and the Power Ministry.

The loan will be utilised to finance part of the fund requirement for a 800 kV high voltage direct current lines under the North Eastern Northern-Western Region Inter-connector-I project and a 800kV high voltage alternating current sub-stations under upgradation of transmission capacity from the Uttarakhand project.

The company also signed a $600-million loan pact with the World Bank to finance its five transmission schemes.

The schemes are: East-West Transmission Corridor, Western Region System Strengthening Scheme II, Eastern Region System Strengthening Scheme I, Balia-Bhiwadi HVDC Bipole System, and North-West Transmission Corridor.

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