HYDERABAD, August 14, 2010: A Loan Agreement of $ 450.60 million equivalent for the Andhra Pradesh (AP) Water Sector Improvement Project was signed today by the representatives from the Government of India, Government of Andhra Pradesh and the World Bank. The signatories to the Agreement were Mr Anup K. Pujari, Joint Secretary, on behalf of the Government of India, Mr Aditya Das, Secretary, Irrigation and Command Area Department, Government of Andhra Pradesh and Ms Giovanna Prennushi, World Bank’s Acting Country Director in India.
The AP Water Sector Improvement Project is designed to strengthen the State’s institutional capacity for multi-sectoral planning, development and management of its water resources. It seeks to improve irrigation service delivery on a sustainable basis to increase productivity of irrigated agriculture in the Nagarjuna Sagar Scheme (NSS), a large multipurpose water project which generates hydro power, supplies water for industries, rural and urban drinking water and irrigation water to about 0.9 million hectare area. Poor maintenance and irrigation management over the past 40 years has left the system in a deteriorated condition, leaving tail-end areas without adequate water.
“Agriculture is a vital sector in Andhra Pradesh, contributing about 29 percent of its GDP and employing the majority of the rural population,” said R.S. Pathak, World Bank Sr. Irrigation Engineer and project team leader. “This project will contribute to the rehabilitation and modernization of NSS, and restructuring of water sector institutions in AP state to improve their capacity to effectively manage their water resources and delivery of irrigation services. In combination with strengthened agricultural support service delivery and improved marketing arrangements, these interventions will enhance farmer’s ability to increase the productivity of water in the project area.”
The $ 450.60 million loan for the Andhra Pradesh Water Sector Improvement Project, from the International Bank for Reconstruction and Development (IBRD), has a 30 year maturity which includes a 5-year grace period.
