ADB Board of Directors approved the grant from the Government of the United Kingdom to increase the capacity of lower income states such as Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa and Rajasthan to prepare and implement ADB-supported projects. ADB will administer the grant, with the Government of India providing counterpart support of $3.5 million.

“The technical assistance will help reduce project start-up time; build critical project implementation capacity in lower-income states; strengthen direct and indirect contributions to poverty reduction and more inclusive growth, and enhance government ownership of projects,” said Prodyut Dutt, Senior Transport Specialist, in ADB's South Asia Department.

The assistance will be used to fund project feasibility studies; to conduct due diligence on social and environmental safeguard measures; to support the preparation of bid documents and to assist in the calling for, and evaluation of bids.

It follows previous technical assistance, approved by ADB in 2006, to enhance the ability of poorer states to prepare projects. The success of that initiative prompted the Government of India to request a follow-on facility from ADB.

A number of technical assistance projects earmarked for 2009 and 2010 will benefit from the latest financial support including building up capacity for value chain management in agribusinesses; preparing an investment plan for urban development in Himachal Pradesh, and an integrated coastal protection and management project.

India has slashed poverty levels from about 36% of the population in the mid 1990's to around 27% in 2005, but around 302 million people still live below the national poverty line. The regional disparities are acute, with poverty incidence in the states of Orissa, Bihar, Chhattisgarh and Jharkhand all over 40%. The global economic crisis which has slashed growth in Asia, now threatens to prevent millions of people from escaping extreme poverty.#