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Himachal Pradesh, World Bank Sign $82 million Loan Deal for HP State Roads Transformation Project

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Government-of-India,-Government-of-Himachal-Pradesh-and-World-Bank-sign-$82-million-loanOn September 7, 2020 The State Government of Himachal Pradesh (HP) and World Bank signed a $82 million (approximately Rs. 600 Crores) loan deal to strengthen its transport and road safety institutions by improving the condition, safety, resilience, and engineering standards of the state’s road network.

The loan from the International Bank for Reconstruction and Development (IBRD), has a final maturity of 15 years including a grace period of five years.

Signing Authorities:

The Loan Deal was signed by Sameer Kumar Khare, Additional Secretary, Department of Economic Affairs, Ministry of Finance on behalf of Government of India, Jagdish Chander Sharma, Principal Secretary to Chief Minister and Public Works Department, on behalf of Government of HP, and Junaid Ahmad, Country Director, India on behalf of the World Bank.


The Agreement will help the state develop reliable, resilient and safe roads which are crucial for the economic development of the state. It will also enhance the state’s ability to identify, analyze, develop and prioritize critical road safety measures that benefit all road users.

Key Points:

i.Safe Systems’ approach to be adopted in selected districts and heavily trafficked corridors.

ii.Under the agreement, the State Highway Patrol will be trained and equipped with surveillance gear. 

iii.Emergency response system to be established to help connect accident sites with dedicated hospitals for post-crash care and data collection.

iv.Measures such as creating an emergency response crew, upgrading drainage structures and protecting landslide prone areas to help build resilient road infrastructure. 

v.Himachal Pradesh State Roads Transformation Project will finance initiatives to build climate and disaster resilient roads, improve road safety along tourism corridors in Himachal, enhance logistics along fruit belts and support the government’s initiative to create a corporate entity responsible for ensuring well-performing roads.

vi.Himachal Pradesh has the potential to produce high-value horticultural products.This project will support the Government of Himachal Pradesh to provide greater opportunity to smallholder farmers access domestic and international agricultural markets, increase jobs and farmers’ incomes.

Women’s Self-Help Groups (SHGs):

A third of the maintenance contracts under the project will be awarded to women-led Self-Help Groups (SHGs).

Environmental Forces:

i.HP often faces landslides and flash floods that affect its road connectivity. 

ii.Events such as Cloud bursts, extreme river flows and flooding are causing landslides and erosion of embankments and loss of roads or bridges are set to increase over the next few decades due to climate change.

iii.In order to address these issues, and to protect against landslides and floods, the project will implement engineering solutions that are plant and natural-based and control vehicular emission to address the climate risks.

iv.The state has no Early Warning System (EWS), landslides cause fatal accidents, during snow and rainy season, transportation of agricultural products and tourists, so the services are either terminated or delivered at a high cost.

Recent Related News:

i.Board of executives of the World Bank (WB) approved loan of $ 500 million (about Rs 3,700 crore) under ‘Strengthening Teaching-Learning and Results for States Program (STARS)’project to improve the quality and governance of school education across six states (Himachal Pradesh, Kerala, Madhya Pradesh, Maharashtra, Odisha, and Rajasthan) in India.

ii.World Bank named former Bear Stearns executive Carmen Reinhart as its new Vice President (VP) and chief economist.

About World Bank:
President – David Malpass
Headquarters – Washington D.C (United States of America)

About Himachal Pradesh:
Chief Minister – Jai Ram Thakur
UNESCO Heritage Site – The Great Himalayan National Park, Kalka Shimla Railway Line.