Loans are for projects in India, Russia and South Africa
The first president of the New Development Bank K. V. Kamath speaks at the 2nd annual meet of the new lender in New Delhi on April 1 2017 [Image: BRICS Business Council]
The BRICS New Development Bank (NDB) Board of Directors (BoD) approved four infrastructure and sustainable development projects with loans aggregating to some $1.4 billion, bringing the Bank’s portfolio to 42 projects with loans aggregating to $11.6 billion.
The NDB will provide two loans of $323 million each to the Republic of India for on-lending to Government of Andhra Pradesh for the Andhra Pradesh Roads and Bridges Reconstruction Project (APRBRP) and the Andhra Pradesh Mandal Connectivity and Rural Connectivity Improvement Project (APMCRCIP) respectively.
The NDB said the two projects will address the road network issues in the state of Andhra Pradesh by widening roads and widening and reconstructing weak and narrow bridges to provide all-weather road network connectivity.
APRBRP comprises widening of about 1,600 km of state highways from single/intermediate lanes to double lanes and reconstructing 269 bridges on the state highway network. APMCRCIP comprises widening of about 1,400 km of district roads from single/intermediate lanes to double lanes and reconstructing 206 bridges on the district road network.
For Russia, the NDB board approved a loan of $300 million to the Eurasian Development Bank for Renewable Energy Sector Development.
“The objective of the Project is to facilitate investment in renewable energy generation plants that will contribute to Russia’s power generation mix in line with the country’s Energy Strategy 2030, and to avoidance of carbon dioxide emissions. The proposed NDB loan will be used by EDB for on-lending to sub-projects using wind, solar, and small hydropower (less than 25 Megawatt) energy generation technologies,” the NDB said.
In the case of South Africa, the NDB board approved a loan of 7 billion rand to the South African National Roads Agency Limited (SANRAL). This loan is guaranteed by the government of the Republic of South Africa. The NDB has received regulatory approval for a 10 billion rand local currency bond programme in South Africa.
Monale Ratsoma, the Director General at the Africa Regional Centre (ARC) for the New Development Bank (NDB) said the loan did not replace existing loans.
“The loan is for both maintenance of roads and construction of new ones, bridges etc. It will not be to refinance existing debt. Unfortunately, we cannot disclose the details of the terms, but I can tell you that as a sovereign guarantee loan, it enjoys the best rates possible by the NDB in rand,” he said.
The NDB plans to almost double its loans to $16 billion this year and increase its impact, as the bank seeks to broaden its global development partnerships and mobilize more institutional and private capital.
In 2018, the NDB approved 17 loans totaling about $4.6 billion, building on its base of 13 loans worth $3.4 billion as of the end of 2017. That brought the total loan book of the bank to 30 projects worth approximately $8 billion by the end of last year.
Helmo Preuss in Sutherland, South Africa for The BRICS Post
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