Himachal Pradesh Cabinet which met under the Chairmanship of Prem Kumar Dhumal, granted approval to the proposal of World Bank funded US$ 200 Million ( Rs. 1100 crore) Himachal Pradesh Development Policy Loan (DPL) to ‘Promote Inclusive Green Growth and Sustainable Development, in State, here today.
The protection of environment is a big challenge which the humanity is facing today. It involves the protection of precious biodiversity, forests, wildlife, water quality and ambient air quality etc. The protection of environment is important not only for the survival of all forms of life and mankind but also for our future generations. In this context, the responsibility of the Himalayan States is of immense importance as they provide the perennial sources of water for the country and also serve as lungs for the northern India. With the challenge of Climate Change, untimely rains, depletion in water tables, scarcity of potable water, rapid melting of glaciers in the entire Himalayan region, reduction in snow fall, reduction in production of foodgrains, increased demand and pressure on natural resources etc. are posing serious challenges which needs to be addressed.
Accordingly, the Government of Himachal Pradesh through the Department of Environment, Science & Technology, has undertaken many path-breaking initiatives in the Environment Sector including submission of proposal titled as ‘Himachal Pradesh Development Policy Loan (DPL) to Promote Inclusive Green Growth and Sustainable Development’ amounting to US$200 million (Rs. 1100 crore) to the World Bank. Various departments of the State Government have already undertaken prior actions proposed by the World Bank with the approval of competent authority.
The State Government is seeking this DPL to support the policy reform program of the State and to promote a paradigm shift towards a more sustainable economic development model that would gel with the State’s comparative advantage and abundant natural resources. The objective of the proposed World Bank funded Development Policy Loan (DPL) is to support Government of Himachal Pradesh to undertake critical policy actions with monitorable results, particularly with regard to the energy sector, tourism, industrial and rural development. The DPL has been designed to be able to access the International Bank for Reconstruction and Development (IBRD) and the Clean Technology Fund (CTF) which are two disbursement windows of fund flow from the World Bank. It is for the first time in the country that the Clean Technology Fund (CTF) window of funding is being accessed and Himachal Pradesh has been selected as a State which has the capability and potential to deliver and to access these funds.
The Programme of reforms undertaken by the Government of Himachal Pradesh is aimed at generating growth through the improved management of its natural assets across growth energies of the economy and to promote inclusive green growth and sustainable development. It is anticipated that this DPL will further deepen the reform program, and contribute to several outcomes both in short and long terms.
In the energy sector, the reforms will enable the State to harness hydro power potential in a sustainable and environment friendly manner. Himachal Pradesh will also implement an innovative benefit sharing scheme based on annuity payments to affected communities during the lifetime of each hydro power project.
The watersheds of the major North Indian rivers sustain life and support the agrarian economy of over 200 million people in Haryana, Punjab, Uttar Pradesh and Rajasthan. As part of the DPL, the Government of Himachal Pradesh intends to promote micro-water watershed conservation and development approaches that would contribute to alleviating rural poverty and improve water pondage, crop diversification, productivity and water efficiency in atleast one Gram Panchayat per Block.
Managing emissions from industry and promoting cleaner forms of economic growth will be essential to meet the inclusive green growth and sustainable development goal of the State. Himachal Pradesh also has considerable unrealized ecotourism potential for developing these cleaner sources of growth. The reforms will also enable the use of economic instruments for environment management pollution control in the State.
There is strong ownership of the proposed reforms across the departments in the State, and teams have been mobilized to implement the same. In addition, the State is committed to monitor the results and adjust the programme as may be required from time to time.
Sudripta Roy, Chief Secretary, apprised that the Council of Ministers about the approved proposal for seeking World Bank Funded US$200 Million ‘Himachal Pradesh Development Policy Loan to Promote Inclusive Green Growth and Sustainable Development, which comprises of 90 percent grant and 10 percent loan. He further apprised that that the loan component amounting to 20 Million US$ would be at a very subsidize rate of interest i.e. 0.74 percent payable in 30 years and would usher in sustainable development and inclusive green growth in the State.
Chief Secretary further informed that the Council of Ministers and particularly the Chief Minister, lauded and appreciated the efforts of the Department of Environment, Science and Technology, Department of Finance and Planning and other line departments and its officers who had toiled hard and negotiated first of its kind financial loan for Himachal Pradesh.