WASHINGTON, November 19, 2010 -- The World Bank today approved a $154 million credit in additional financing to support the Government of Tamil Nadu in implementing a comprehensive empowerment and poverty reduction program in this Indian State.
Although Tamil Nadu has achieved significant development outcomes over the past decade, over 12 million people still live in poverty, especially in rural areas where agricultural is vulnerable to drought.
The objective of the Tamil Nadu Empowerment and Poverty Reduction Project – called “Vazhndhu Kaattuvom” locally, meaning ’new life’ – is to create economic opportunities and build social capital in the poorest communities. It involves them in designing and implementing changes that provides them with new income generating opportunities.
The Project has reached 2,500 villages covering an estimated 1.5 million people. Assessments have demonstrated that over 87% of households have shown an improvement in their economic status, with mean incomes of US$ 668 against the project baseline of US$469. In addition, 53,810 young people have been trained for employment in areas such as the construction industry, service sector, telecommunications and garment production.
The project started in November 2005, targeting the poorest blocks across 16 of Tamil Nadu’s districts. The additional financing will expand the Project into an additional 46 new blocks of villages spread across 10 new districts, and into 4 new blocks in existing project districts, selected on the basis of poverty indicators.
“This project builds on Tamil Nadu’s existing programs and good practices using what we call the Community Driven Development approach,” says Natasha Hayward, Project Team Leader. “This puts poor people at the center of the planning and implementation of the changes that will affect their lives. The project focuses on reducing poverty through building social capital and a resource base in the poorest and most vulnerable communities. The approach emphasizes inclusion and strengthening local organizations and village governance.”
The credit, from the International Development Association (IDA), the World Bank’s concessionary lending arm, carries a 0.75 service fee, a 10-year grace period, and a maturity of 35 years.