The Narendra Modi-led government has taken two loans worth over Rs 9,000 crore from the Beijing-based to Asian Infrastructure Investment Bank (AIIB) to meet challenges posed by the coronavirus pandemic, Union Minister of State Anurag Thakur told Parliament on Wednesday.
Thakur made the statement in the Lok Sabha response to queries posed by BJP parliamentarians Sunil Kumar Singh and PP Chaudhary in the Lok Sabha about how the Centre had utilised the funds and whether they had been transferred to the states.
The Union minister’s revelations come at a time when the Modi government is issuing statements on the months-long border clashes with China along eastern Ladakh.
Earlier, Finance Minister Nirmala Sitharaman had invited AIIB to participate in India's ambitious $1.4 trillion (about Rs 111 lakh crore) infrastructure development programme which the government is keenly pushing to revive economic growth hit by COVID-19 pandemic.
India is a founding member of the multilateral funding agency with the second highest voting share. India has 7.65 per cent vote share in the AIIB while China holds a whopping 26.63 per cent stake in the organisation which was set up in 2016.
Thakur informed the Lok Sabha the first loan agreement was signed with AIIB on May 8 while the second one was inked on June 19, about four days after the clash in Galwan Valley in which at least 20 soldiers of the Indian Army had lost their lives. Initial reports about intrusion by Chinese army in Ladakh had started coming from May.
“The Government of India has signed two loan agreements with the Asian Infrastructure Investment Bank under COVID-19 Crisis Recovery Facility,” Thakur said. “First loan of $500 million (Rs 3,676 crore approximately) was signed on May 8, 2020, to partly support the ‘India COVID-19 Emergency Response and Health Systems Preparedness Project’ to respond to the threat posed by COVID-19 pandemic and strengthen the national health system for preparedness,” Thakur said. So far, AIIB has released about Rs 1,847 crore from this, he added.
“The second loan of $750 million (Rs 5,514 crore approximately) was signed on June 19, 2020, as budgetary support to Government of India for accelerating India’s COVID-19 Social Protection Response Programme to support measures undertaken under the Pradhan Mantri Garib Kalyan Yojana (PMGKY), the benefits of which have also flown to states/Union territories.”
Later in the day, Congress leader Rahul Gandhi hit out at the government for taking “huge loans” from the bank amid the border standoff with China.