G-8 sanctions may not affect Andhra projects

HYDERABAD, June 25: Faced with the threat of economic sanctions by the G-8 countries in the wake of the Pokharan nuclear tests last month, t...

HYDERABAD, June 25: Faced with the threat of economic sanctions by the G-8 countries in the wake of the Pokharan nuclear tests last month, the Andhra Pradesh government has stepped up lobbying to get its projects cleared by the World Bank at the latter8217;s board of directors meeting in Washington today.

Two proposals 8212; the AP economic reconstruction programme APERP with an outlay of Rs 2,300 core and the first instalment of AP State Electricity Board reforms scheme worth Rs 600 crore 8212; are slated to come up before the board.

Finance department principal secretary D Subba Rao who is currently in Washington on a training programme has been asked to meet the bank8217;s directors and try to get early clearance for the two projects.

Chief Minister N Chandrababu Naidu spoke to World Bank8217;s resident officials in Delhi twice and urged them to exempt the State8217;s projects from the purview of the sanctions as any cut in aid would adversely affect the reforms process. 8220;WB officials in Delhi are convinced of ourcase,8221; a senior official told The Indian Express. They, however, expressed apprehensions that the aid might be postponed by at least six months given the control exercised by the G-8 countries over the World Bank.

In such an event, it was feared that the pace of reforms in the State would be affected. 8220;Once the process is derailed, it will be difficult to implement the rest of the programmes as per schedule,8221; a minister, who preferred anonymity, said.

Though officials are tightlipped over the strategy being adopted to salvage the projects, particularly the APERP, Subba Rao is expected to cite the State8217;s performance in the implementation of the old and existing projects of the World Bank. 8220;Commitment to the reforms process has been our strong point,8221; an official said.

Andhra Pradesh was one of the few states in the country which earned the bank8217;s accolades for the quality of work and the strict adherence to the norms. Because of this image, the State even surpassed Maharashtra8217;s enviableposition as the largest receiver of World Bank assistance this year.

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As many as 10 aided projects with a total investment of Rs 5,778.91 crore were in different stages of implementation in AP. While the bank8217;s loan commitment was Rs 4,320 crore, the actual expenditure incurred upto March this year was around Rs 915 crore. Though the budget for 1998-99 estimated that Rs 872 crore would come from the bank, there were no releases during the current financial year. The AP-III irrigation project worth Rs 180 crore and the AP hazard mitigation project of Rs 204 crore were among them.Besides the World Bank, the Oversees Economic Cooperation Fund OECF of Japan is the second biggest funding agency for the State, with a total loan component of Rs 3,765 crore for five projects. As against the budgeted amount of Rs 572.76 crore for 1998-99, only Rs 13 lakh was received so far.

The Srisailam Left Bank Canal project worth Rs 340 crore, Srisailam transmission project Rs 167.87 crore, modernisation of KC Canal Rs52.29 crore and the Simhadri and Vizag transmission system project Rs 11.74 crore are some of the major schemes awaiting Japanese aid. The State government officials seem to have lost hope of receiving any help from the OECF, as Japan was a vociferous advocate of sanctions. 8220;We only expect that they would not upset the projects already commissioned or signed,8221; said an official.