India to get $22.6 bn infrastructure loan from Japan

Japan will give a fresh loan of about $22.6 billion for the second phase of Dedicated Freight Corridor and an infrastructure project in South India, Prime Minister Yoshihiko Noda on Tuesday told his Indian counterpart Manmohan Singh as they met here, making up for an opportunity lost a few days ago.

Singh, while welcoming the announcement of loan, emphasised to Noda that India's priority was investments by Japanese companies in infrastructure projects like Delhi Metro Rail, which was a "fine example" other cities want to emulate.

The two leaders were to meet in Tokyo on November 16 during Singh's scheduled three-day visit beginning November 15 for annual Summit. However, the visit was cancelled just a day ahead in view of sudden political developments in Japan with Noda deciding to announce elections.

During the meeting today on the sidelines of East Asia Summit, Noda expressed happiness at being able to meet Singh to underline the close Strategic and Global Partnership between the two countries, sources said.

He told Singh that he wanted to discuss the next steps in the relationship since they could not meet in Tokyo for the Annual Summit due to domestic developments in Japan, they said.

Noda informed Singh that Japan will be announcing the second round of loans under Overseas Development Assistance (ODA) for the second phase of the Dedicated Freight Corridor and a third infrastructural project in South India, where Japanese companies have a good presence, the sources said.

The fresh loan amount is expected to be 184 billion yen, approximately $22 billion.

The Japanese Prime Minister also mentioned Japanese interest in continuing the consultation on the high-speed railways.

Both the Prime Ministers expressed happiness on the signing of the MoU on Rare Earths and the Agreement on Social Security signed on November 16 in Tokyo.