Role of International Finance Institutions

Topics: Economics, Economic development, India Pages: 7 (2330 words) Published: June 9, 2013
ROLE OF INTERNATIONAL FINANCE INSTITUTIONS
BB0030

2013
LOCHIN BAWEJA
BBA (6TH SEMESTER)
Roll No. - 521067514
Center Code - 01665
ROLE OF INTERNATIONAL FINANCE INSTITUTIONS
BB0030

2013
LOCHIN BAWEJA
BBA (6TH SEMESTER)
Roll No. - 521067514
Center Code - 01665

Bachelor of Business Administration-BBA Semester 6
BB0030 – Role of International Finance Institutions- 2 Credits Assignment Set- 2 (30 Marks)

[Each question carries 10 Marks. Answer all the questions.]
Q1. How has India benefited from International Development Association? Ans. India and the IDA
India has immensely benefited form the credits granted to her by the IDA. Up to June 30, 1997, India had received massive credit assistance of $ 24,432.9 million in the form of 219 credits to finance her various development projects. This is by far the largest credit assistance that the IDA has given to any single member country so far. The first credit of $ 60 million was granted in June 1961 to assist a programme of road construction and improvement. The second credit of $ 6 million was given in September 1961 for the expansion of tube-well irrigation in Uttar Pradesh. The economic benefits of this project financed through the IDA’sloan had been considerable. The loan had provided finance for the drilling and equipping of 800 tube-wells which have irrigated 320,000 acres of land in Uttar Pradesh. This has increased the value of farm production in the area to the tune of Rs. 10 crores. The IDA granted another credit of $ 10 million for financing the flood control and drainage scheme in Punjab. As a result of the loan, surface drainage problem has been solved over an area of about 8 million acres in the state. In addition, two more credits each of the amount of $ 8 million and $ 4.5 million had been given by IDA to assist the Salandi Project in Orissa for the irrigation of 2,25,000 acres of land and to finance the completion of the Shetrunji Project in Gujarat respectively. In June 1962, the IDA gave a $ 15-million credit for improving the Sone River irrigation system in Bihar. The scheme financed by this credit has provided irrigation facilities to one lakh acres of land in Western Bihar. In June 1962, IDA extended $ 13 million credit for Purna River valley irrigation project in Maharashtra State. The project has provided irrigation facilities to 152,000 acres of dry land and generates 15,000 KW electric power in the State of Maharashtra. The 50-year credit is interest free. During the fiscal year 1968 – 69, the IDA extended two credits to India – one credit of $ 27.5 million for the development of telecommunications facilities and another credit of $ 125.0 million for industrial imports. During 1969 – 70, the IDA had granted 4 credits totalling $ 200 million to India consisting of one credit of $ 55 million for the expansion programme of Indian railways, one credit of $ 75 million for industrial imports and two credits of $ 70 million (of $ 35 million each) for the development of irrigation facilities. During 1971 – 72, the IDA provided $ 412.2 million in the form of 11 credits for the diversified economic development of country’s economy. These included a $ 75 million credit for industrial imports to enable selected Indian industries to expand their production of fertilisers and capital goods essential for the development of key sectors of economy – agriculture, electric power and transport; a $ 83 million credit for the development of shipping transport; a $ 12 million credit for agricultural education for developing two new agricultural universities in Assam and Bihar; a $ 25 million credit to meet the development needs of the small-scale industry sector over the next two years; a $ 58 million credit to increase the production of fertilisers; a $ 85 million credit for the expansion of power transmission facilities in Assam, Delhi, Haryana, Kerala, Madhya Pradesh, Maharashtra, Mysore, Orissa, Punjab, Rajasthan and Tamil Nadu,...
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