Japan to provide development assistance loan worth Rs. 3,500 crores to India to fight COVID-19 pandemic

Japan announced on August 31, 2020, that it will provide an Official Development Assistance loan of Rs. 3,500 crores to India for the COVID-19 Crisis Emergency Response Support. It will also include the implementation of health and medical policy.

CS Mohapatra, Additional Secretary, Department of Economic Affairs of Finance Ministry, and Suzuki Satoshi, Japanese Ambassador exchanged the notes on August 31 regarding the provision of the yen loan to New Delhi to fight COVID-19.

Subsequent to the exchange of notes, the loan agreement for the programme was signed between Katsuo Matsumoto, Chief Representative of JICA (Japan International Cooperation Agency) in New Delhi, and Dr. Mohapatra.

Exchanged the E/N for Yen Loan with Dr. C.S. Mohapatra, Ministry of Finance. This 50-billion-yen loan aims to develop hospitals equipped with ICUs and infection prevention facilities, and to promote telemedicine in villages across India. #FightCOVID pic.twitter.com/SxGIsJamKk

— Satoshi Suzuki (@EOJinIndia) August 31, 2020

Key Highlights:

• The loan provided by Japan to India to fight the COVID-19 crisis will have an interest rate of 0.01 percent per annum along with a redemption period of 15 years, which includes a four- year grace period.

• India and Japan have also exchanged notes on a grant worth of 1 billion Yen to India through Japan’s Official Developmental Assistance Scheme, named ‘The Economic and Social Development Programme’.

• The provided grant aid will lead to reinforcing the fight against infectious diseases including the Coronavirus pandemic in India.

• The loan agreement will also further strengthen the cooperation between India and Japan.

What is the objective of the provided loan?

As per the official release by the Japanese Embassy, the COVID-19 crisis response emergency support loan will provide the necessary fund for India’s fight against the deadly Coronavirus.

The financial support will be able to provide support for the implementation of health and medical policy by the Indian government. It will also lead to the development of the hospitals equipped with infection prevention, ICUs, and management facilities.

These measures are expected to control the spread of Coronavirus infection in India. It will further contribute to the recovery and the stability of the country’s economy and society, as well as to sustainable development.