15-billion ADB loan to India to fund COVID-19 emergency

15-billion ADB loan to India to fund COVID-19 emergency

Part of: GS Prelims and GS-II – International Groupings; Health & GS-III – Economy; Disaster Management

In News:

• The Asian Development Bank (ADB) has provided $15 billion loan to the Government of India to fund its immediate response to the coronavirus (COVID-19) pandemic 
• The loan shall be used to deal with health and socio-economic impacts. 

Key takeaways:

• The loan is approved by the ADB under its COVID-19 Active Response and Expenditure Support (CARES) Programme. 
• The loan is the bank’s largest loan to India till date.
• The money will be spent to implement the containment plan and rapidly increase the test-track-treatment capacity. 
• It will also be used to provide social protection to poor people over the next three months. 
• India will also take the ADB’s technical support to strengthen its implementation framework and capacities to implement Pradhan Mantri Garib Kalyan Yojana. 

Important value additions:

Asian Development Bank (ADB)

• It is a regional development bank. 
• It was established on 19 December 1966. 
• Headquarters: Mandaluyong, Philippines. 
• It was established to promote social and economic development in Asia. 
• Motto: ADB is committed to achieving a prosperous, inclusive, resilient and sustainable Asia & the Pacific, while sustaining its efforts to eradicate extreme poverty.
• The ADB offers hard loans (currency) on commercial terms primarily to middle income countries in Asia and 
• It provides soft loans (loan with a below-market rate of interest) to poorer countries in the region. 
• Both types of loans are sourced from the bank’s ordinary capital resources (OCR).
• Five largest borrowing countries are China, India, Pakistan, Indonesia and Bangladesh.