ADB readies $2.2 billion immediate support for India to fight COVID-19

The Asian Development Bank (ADB) will provide an immediate assistance of Rs 16, 500 crore ($2.2 billion) to India to fight COVID-19 pandemic and the fund will further increase if the need be.

The assistance came after Finance Minister Nirmala Sitharaman and ADB President Masatsugu Asakawa had a detailed discussion about India’s emergency needs in the health sector and the help required to alleviate the economic impact of the pandemic on poor.

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“ADB is committed to supporting India’s emergency needs. We are now preparing $2.2 billion in immediate assistance to the health sector and to help alleviate the economic impact of the pandemic on the poor; informal workers; micro, small, and medium-sized enterprises; and the financial sector,” Asakawa was quoted as saying by the Ministry of Finance.

“ADB assistance for India will be further increased if needed. We will consider all financing options available with us to meet India’s needs, including emergency assistance, policy-based loans, and budget support to facilitate swift disbursement of ADB funds. ADB is also engaged with the private sector to meet its financing needs during this period,” the ministry said in a statement.

Asakawa commended India’s response to the pandemic, including a national health emergency program, tax and other relief measures provided to businesses, and a $23 billion economic relief package to provide immediate income and consumption support to the poor, women, and workers affected by the three-week nationwide lockdown.

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Weakening global economic growth is causing disruptions in India’s trade and manufacturing supply chains, along with the slowdown in tourism and other economic activities. This is straining a large number of micro, small, and medium-sized enterprises, and the livelihood of formal and informal labourers across the country.

The International Monetary Fund had on Thursday said that the emerging economies would need trillions of dollars to fight the pandemic and rescue their economies but hundreds of billions would have to come from outside as these economies, weighed down by heavy debt, as they might not be able to fund the entire cost.

Asakawa said the policy measures announced by the government will provide much-needed relief and stimulus to the most vulnerable people as well as businesses and become a basis for faster recovery.

On March 18, ADB announced an initial package of approximately $6.5 billion to address the immediate needs of its developing member countries, including India, as they respond to the COVID-19 pandemic.