I. Consistency of Business Plan With Country Partnership Strategy

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I. CONSISTENCY OF BUSINESS PLAN WITH COUNTRY PARTNERSHIP STRATEGY
1. The Asian Development Bank (ADB) country partnership strategy (CPS) for India, 2018–
2022, aims to accelerate India’s inclusive economic transformation. The country operations
business plan (COBP), 2019–2021 is aligned with the three strategic pillars of the CPS: (i)
boosting competitiveness to create more and better jobs, (ii) providing inclusive access to
infrastructure networks and services, and (iii) addressing climate change and increasing climate
resilience. About 45% of the proposed program under the COBP will contribute to the first pillar,
95% for the second pillar, and 58% for the third pillar.
2. Following the embedded principles of the CPS, the proposed program is driven by front-
end strategic studies such as in East Coast Economic Corridor (ECEC) that is identifying
transformative investments, and pursues wider and deeper partnerships with low-income states
building their capacities for project operations. The COBP’s 3-year pipeline for ECEC amounts to
$2.4 billion and for low-income states amounts to $5.8 billion. The proposed pipeline is also
aligned with the government’s flagship programs in energy, transport, urban, and skills sectors
and aims to demonstrate high value addition in implementation and their impacts.
II. INDICATIVE RESOURCE PARAMETERS
3. India, a group B developing member country, is eligible for regular ordinary capital
resources lending. The indicative resources available for commitment during 2019–2021 for
sovereign operations amount to $7.54 billion. Against this, the proposed lending program for
2019–2021 is $10.61 billion, comprising $3.53 billion for 2019, $3.55 billion for 2020, and $3.53
billion for 2021. Overprogramming of about 40% is included to place the program on the trajectory
of scaling up of sovereign lending, as requested by the government, to $3 billion or more per year.
This will also allow for greater project readiness and quality at entry, thereby enhancing project
implementation and portfolio performance. Nonsovereign resources will supplement sovereign
lending operations. Cofinancing and funding from other sources, including the regular OCR
regional cooperation and integration set-aside, will be explored. 1 The final amount of assistance
will be subject to resource availability and project readiness.2
4. The 3-year program reflects the government’s priorities and ADB’s comparative
advantage and is primarily focused on infrastructure. In terms of resource allocation, the transport
sector will account for 46%, urban infrastructure and services for 27%, energy for 16%, agriculture
and natural resources for 6%, finance and public-sector management for 2%, and human
development for 3%. The program also reflects the thematic priorities of the CPS, and promotes
private sector investments, regional cooperation and integration, and gender equality and social
inclusion.
5. The technical assistance (TA) program is aligned with the lending program, to support
project preparation and capacity development for project implementation. Following the country
knowledge plan under the CPS, strategic planning studies at the state level and systematic
knowledge products will also be delivered, exploring ways to add higher value on relevant thrusts
of Strategy 2030. 3 The program will provide a sound basis for developing a robust lending
program, and well-performing project implementation portfolio.
6. ADB's nonsovereign operations will also pursue increased annual lending of $1 billion,
and focus on innovative and inclusive infrastructure, and will catalyze the development of the
1 The pilot period for the OCR regional cooperation and integration set-aside fund is up to 2019.
2 Time sliced multitranche financing facility and additional financing will be used, as required, for phasing assistance,
and to balance resource commitment with resource availability.
3 ADB. 2018. Strategy 2030: Prosperous, Inclusive, Resilient, Sustainable Asia and the Pacific. Manila.
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finance sector. Support will be diversified to finance initiatives in the areas of transport, power,
urban infrastructure, agribusiness, health, education, small and medium-sized enterprises,
affordable housing, and financial inclusion. In addition to direct funding, private equity funds that
operate in ADB’s strategic priority areas will be supported. Synergy with sovereign operations will
be maintained where possible, such as in ECEC.
III. SUMMARY OF CHANGES TO LENDING AND NONLENDING PROGRAMS
7. Changes from the COBP, 2018−2020 are outlined below.4
(i) Transport sector. Additions include the stronger pipelines for urban rail transport such as
the Delhi−Meerut rapid transit system program and Chennai metro project, and for ECEC
investments including Tuticorin port expansion. A state highway project and a rural
connectivity project in Maharashtra were also added. On the other hand, the Vadhavan
port and the second Uttar Pradesh road projects were dropped. The modality of the
Mumbai metro project has been changed from a multitranche financing facility to a regular
project, and the amount reduced from $1.1 billion to $925.0 million.
(ii) Water and other urban infrastructure and services sector. The pipeline has added
new projects to provide inclusive urban and municipal services in Kerala and Uttarakhand,
which will further augment project implementation systems and capacity building on the
previous projects. New urban projects in Himachal Pradesh, Jharkhand, and Punjab will
provide the first partnership opportunity with ADB, along with rural water supply projects
in Andhra Pradesh and Bihar, and a smart city project in Tripura. These projects have
replaced TA loans in Uttar Pradesh and Punjab, and three smart city projects from the
pipeline.
(iii) Energy sector. The pipeline has added a new project in Meghalaya which will primarily
enhance energy distribution systems and their efficiency. On the climate-oriented energy
efficiency agenda, the second phase of the Demand-Side Energy Efficiency Project has
replaced the Industrial Energy Efficiency Finance Project. The previously proposed
subregional energy program, Gujarat smart grid project, and power projects in Odisha and
Jharkhand have been excluded from the pipeline.
(iv) Agriculture, natural resources, and rural development sector. New additions to the
pipeline are the agribusiness network project in Maharashtra, and horticulture project in
Himachal Pradesh to enhance high-value agriculture production and value chains. A new
irrigation project in Gujarat would add to ADB’s expansion into large-scale irrigation
projects in India to enhance water use efficiency and productivity. These replace the
previously proposed project on national water use efficiency improvement and the
sustainable coastal project in Maharashtra.
(v) Human development (education and health) sector. A new state-level skills project
replaces the Kerala skills (additional financing) project. Two health projects have been
replaced with “Supporting Comprehensive Primary Health Care in Urban Areas” project.
New projects will be processed on the basis of the demonstration of good performance of
ongoing projects, and strong demand and ownership of partner states.
(vi) Finance and public-sector management. Building on the progress of ongoing loans (in
Punjab and West Bengal), the pipeline is adding one state-level policy-based loan to assist
with public sector management and a small and medium-sized enterprises development
project.
8. The TA program is adjusted to align with the lending program, particularly in the priority
areas of low-income states and ECEC.
4 The changes pertain to the sovereign program.

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I. CONSISTENCY OF BUSINESS PLAN WITH COUNTRY PARTNERSHIP STRATEGY

II. INDICATIVE RESOURCE PARAMETERS

III. SUMMARY OF CHANGES TO LENDING AND NONLENDING PROGRAMS

7. Changes from the COBP, 2018−2020 are outlined below.4

4 The changes pertain to the sovereign program.

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