World Bank proposes multi-billion programme to support low
income states of India
The World Bank has come out with a multi-billion (US$
12-20 billion) four-year plan aimed at bringing down poverty levels in seven
low-income Indian states of Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Odisha, Rajasthan, and
Uttar Pradesh, where majority of
India 's poor live.
The institute’s
Country Partnership Strategy (CPS) for India (2013-2017) proposes a lending
program of US$3 billion to US$5 billion each year over the next four years.
Under the proposal, 60% of the financing will go to state government-backed
projects and half of this, or 30% of total lending, will go to low-income or
special category states (where public services face high delivery costs). Under
the previous strategy, only 18% of lending went to these states.
The Bank’s India
strategy outlines a scenario in which
India improves the inclusiveness of
the economic growth to that achieved by its best performing states. This would
cut poverty to 5.5% of the population by 2030 from 29.8% in 2010 and increase
the share of people living above the threshold where they are at risk of
falling back into poverty. Furthermore, the bank said that
India 's seven low-income states, with 60% of
India 's
poor, are now growing faster than the average, and so investments there have
the potential for greater impact.
Guided by the priorities of
the government of India's 12 Five-Year Plan, the strategy sees sustaining high
economic growth as critical to lifting millions out of poverty in a country
that has the largest number of poor people in the world. According to the Bank,
infrastructure needs are massive; urban centers are growing exponentially, with
cities adding at least an additional 10 million urban dwellers each year; and
social programmes need to be strengthened to generate inclusive growth. Under
the proposals the IFC will invest in areas such as innovative renewable and
green projects, processed food, logistics and infrastructure, agri business,
and finance and insurance.
Warm regards,
Dr. S P Sharma
Chief Economist
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