India, ADB sign $133 million loan for Meghalaya’s power distribution sector

The Indian government signed a loan agreement of $133 million with the Asian Development Bank (ADB) on December 1, 2020, in order to strengthen the power distribution sector in Meghalaya.

The agreement has been signed by the additional secretary, department of economic affairs, CS Mohapatra, and Country Director of Asian Development Bank’s India Resident Mission, Takeo Konishi.

According to the official statement by the Finance Ministry, the loan will be supplemented by a $2 million grant from the bank’s Japan Fund for poverty reduction that will be financing the renewable energy projects as well as supporting the income generation activities for women and other disadvantaged groups.

.@ADB_HQ India sign $132.8 million loan to strengthen Meghalaya’s power distribution sector

▶️Project to construct 23 substations, renovate & modernize 45 substations & upgrade 2,214 kilometers of distribution lines

Details: https://t.co/BaJtRICKiS@MinOfPower @SangmaConrad pic.twitter.com/9dIZ3eI6Oj

— PIB In Meghalaya (@PIBShillong) December 1, 2020

Objective:

The Finance Ministry informed that the loan by ADB will be used to modernize the power distribution network in Meghalaya and to improve the quality of power that is supplied to industries, households, and businesses.

Power distribution projects funded by ADB: Key Details

• The funds from ADB will be supporting the state’s ‘24X7Power for All’ initiative in conjunction with the Indian Government.

• The loan will also fund the projects for renovating and modernizing 45 substations, constructing 23 substations, and installing and upgrade 2,214 km of distribution lines and associated facilities which will cover three out of the six circles in the state.

• The project funded by ADB will develop a distribution sector roadmap and also a financial road map for Meghalaya Power Distribution Corporation Limited.

• The smart meters which will be installed under the funded project is expected to benefit some 1,80,000 households.

• The $2 million grant will also be financing the renewable energy mini-grids to improve power quality apart from supporting the socially disadvantaged groups.

Power cuts in remote villages:

While informing about ADB’s loan agreement for Meghalaya’s Power distribution network, the Finance Ministry stated that even though the state has achieved 100% electrification, the remote villages in the state of northeast still suffer from frequent power cuts because of overloaded distribution networks as well as substations that use outdated technology. It results in a high aggregate commercial and technical loss. To overcome these problems, several projects funded by ADB will be launched by the Meghalaya Government.