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$300 Million Loan Signed To Support India’s National Urban Health Program

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The Asian Development Bank (ADB) and the Government of India have signed a $300 million loan to support the government’s flagship program, the National Urban Health Mission (NUHM), that is aimed at improving the health status of the country’s urban population.The loan—Supporting National Urban Health Mission—will be ADB’s first health project in India. It will reinforce government efforts under the NUHM to develop health systems in urban areas that can deliver quality health services and reach the urban poor and vulnerable. It will focus on strengthening primary health care and also promote better coordination between health and urban sectors and opportunities for public-private partnerships.“The program’s due attention to achieving convergence across key sectors that affect urban health, and to actively involve urban local bodies in planning and delivery of urban health services, is commendable,” said Raj Kumar, Joint Secretary, Department of Economic Affairs at India’s Ministry of Finance, who signed the agreement on behalf of the Government of India.

“The use of ADB’s results-based lending modality will strengthen NUHM systems and overall results orientation, while allowing states the flexibility they need to pursue targets that they need locally,” said M. Teresa Kho, Country Director of ADB’s India Resident Mission, who signed the agreement on behalf of ADB.N. B Dhal, Joint Secretary (NUHM) at the Ministry of Health and Family Welfare, signed the project document on behalf of his ministry. The signatories to the loan also signed the accompanying capacity building technical assistance of $2 million, financed by the Japan Fund for Poverty Reduction.Significant capacity building and mechanisms for learning and innovation are also in-built to enhance NUHM systems, management capacity, and implementation processes.

India is urbanizing rapidly, with massive growth in the number of urban poor. Disparities in health status between the poor and non-poor in urban areas are large, due to the adverse living conditions of the urban poor and their limited access to good basic health services. There are few preventive and primary health services in urban areas, while millions of people are faced with poverty every year due to high costs related to health care.This loan from ADB’s Ordinary Capital Resources has a 20-year term including a grace period of 5 years, and an interest rate to be determined in accordance with ADB’s LIBOR-based lending facility.ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members –48 from the region. In 2014, ADB assistance totaled $22.9 billion, including cofinancing of $9.2 billion.

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