Indian credit of US$403 million for three water supply projects

Indian government came forward to finance three water supply projects in the country that would supply potable water to nearly one million people through a credit agreement, Indian High Commission in Colombo said.

Export-Import Bank of India (Exim Bank) yesterday signed Buyer’s Credit Agreements, under National Export Insurance Account (BC-NEIA) amounting to US$ 403.01 million with National Water Supply and Drainage Board (NWSDB) in Colombo.

The three water supply projects are identified as Aluthgama, Mathugama and Agalawatta Integrated Water Supply Project, Polgahawela, Pothuhera and Alawwa Integrated Water Supply Project; and Kundesale, Haragama Water Supply Project.

The agreements were signed by Yaduvendra Mathur, Chairman and Managing Director (CMD), on behalf of Exim Bank and Eng. Kuddoos Alahudeen Ansar, Chairman, NWSDB and Mohamed Shafeek Rajabdeen, Vice Chairman, NWSDB, in the presence of Minister of City Planning and Water Supply of Sri Lanka, Rauf Hakeem, High Commissioner of India Y.K. Sinha.

Speaking on the occasion, Minister Rauf Hakeem expressed satisfaction at the conclusion of these agreements and thanked the Government of India for financing the three water supply projects, adding that the projects would supply potable water to nearly one million people.  CMD, EXIM Bank thanked the High Commission for facilitating the conclusion of these Buyer’s Credit agreements and reiterated EXIM Bank’s commitment to finance further projects in Sri Lanka.  

Under the Buyer’s Credit portfolio, EXIM Bank has already extended credit amounting to nearly US$ 185 million to Sri Lanka for water supply and other projects.  

The Buyer’s Credit Scheme of India is a unique financing mechanism that provides a safe mode of nonrecourse financing option to Indian exporters and serves as an effective market entry tool to traditional as well as new markets in developing countries, which need deferred credit on medium or long term basis.