1. As per the new policy announced by FM in the Budget for 2003-04, GOI is continuing further bilateral development cooperation with six development partners (European Commission, Germany, Japan, Russian Federation, U.K. and U.S.A.), three of which are dealt with by EEC Division i.e. European Commission, Germany and United Kingdom. Other partners dealt with by EEC Division include Belgium, Denmark, France, Italy, The Netherlands, Norway, Sweden and Switzerland. The new policy for other partners, while precluding fresh bilateral development cooperation at the Government level provides for continuation of the ongoing projects. Further, as per this policy, these partners can channelise further bilateral development cooperation assistance to NGOs, Universities, Autonomous Institutions etc. as per GOI’s guidelines which can also be availed of by the partners with whom further bilateral development cooperation at Governmental level is continuing.

2. The guidelines for future development co-operation with bilateral partners were issued on September 12, 2003. Operational clarifications on these guidelines were issued on January 5, 2004. These have also been placed on the Ministry of Finance website( www. finmin.nic.in).

3. The work related to bilateral development cooperation includes :-

• appraisal of identified projects in conjunction with bilateral development cooperation partners;
• negotiating development cooperation assistance packages at inter-governmental talks leading to the conclusion of agreements;
• framing targets for disbursements of external assistance from development cooperation partners and;
• monitoring of technical assistance, including project related training programmes under the bilateral cooperation (excluding Colombo Plan).

4. Other Major Functions of EEC Division include:--

• work relating to Commonwealth Secretariat and Commonwealth Fund for Technical Cooperation (CFTC), except training programmes for which the nodal Section in DEA is the Project Monitoring Unit (PMU).

• In the course of discharging the functions relating to development co-operation programmes, EEC Division interacts with agencies like KfW, GTZ, DFID, DANIDA, SIDA, NORAD, EC Delegation and the Missions of other bilateral partners.

5. Sectoral and Territorial charges :-

- sectoral responsibility in respect of matters relating to Ministries of Social Justice & Empowerment, Tribal Affairs, Youth Affairs & Sports, Election Commission of India.

- external territorial charges of the countries dealt with by EEC Division

- external territorial charge of Nepal.

DEVELOPMENT COOPERATION PROGRAMME

As on 31.12.2003, approximately 160 projects were under implementation with assistance from cooperation partners dealt with by EEC Division. During the past three years and up to the month of November of FY 2003-04, the amount of assistance received from these development partners is as follows:

To see the details of the development cooperation programme with individual partners, click the name of the partner below:

European Commission

Germany

UK

Other Development Partners : Countries like Belgium, Denmark, France, Italy, The Netherlands, Norway, Sweden and Switzerland, have provided limited assistance for selected projects. Some of the identified sectors for these countries are natural resource management, pollution control, environment, watershed development, health, agriculture, water and sanitation.

The European Union (EU) has 15 countries as its members, namely, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, The Netherlands, Portugal, Spain, Sweden and UK.

2. The EC has been extending economic assistance to India since 1976. The EC assistance to India is entirely in the form of grants and can be used to finance the Rupee as well as foreign exchange costs of identified projects. The cumulative total of EC’s financial and technical assistance since 1976 is around Euro 2.00 billion.

3. Priority sectors for EC are education, health and environment. Presently, EC assistance is being provided for projects in the sectors of irrigation, forestry, education and health. There are two ongoing central projects in education sector (Sarva Shiksha Abhiyan) and health sector (Health & Family Welfare Sector Development Programme) with EC assistance of Euro 200 mln. and Euro 240 mln., respectively.

4. EC has recently decided to develop a partnership programme with two Indian States, namely, Chhattisgarh and Rajasthan, which were identified in consultation with GOI. EC’s "State Partnership Programme", which would cover the education, health and environment sectors forms a part of its proposed National Indicative Programme (NIP) for India for 2004-06, which envisages a commitment of Euro 160 million for the State Partnership Programme and Euro 33 million for EU-India Scholarship Programme.

5. EC has made a commitment of Euro 25 million during the year 2003-04 comprising Euro 15 million for the EU-India Investment Development Programme and Euro 10 million for Disaster Preparedness Support Programme. EC is providing assistance to two centrally sponsored schemes i.e. Sarva Shiksha Abhiyan and Health & Family Welfare Sector Development Programme. EC has provided Euro 200 million and Euro 240 million, respectively, for these two projects.

6. Disbursement of EC assistance for ongoing development cooperation projects during 2002-2003 was Euro 65.23 million. During 2003-04 (up to 30.11.2003), the disbursement was Euro 2.308 million.

Website of EC: www.delind.cec.eu.int

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I. Background :

The Federal Republic of Germany (FRG) has been providing both Financial and Technical Assistance to India under the Indo-German Bilateral Development Cooperation Programme since 1958.

II. Priority sectors and areas of cooperation:

The overall aim of Indo-German Bilateral Development Cooperation is poverty alleviation, employment generation and sectoral reforms. The following are the focal areas of Indo-German Development Cooperation:

- Environmental policy, protection and sustainable use of natural resources;

- Energy;

- Economic reform and development of the market system;

- Health, family planning, HIV/AIDS.

Projects are selected as per development priorities of the Government of India as laid down in the 10th Five Year Plan (2002-2007). The states of Himachal Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan, Orissa and West Bengal are the regional priorities of Indo-German Cooperation. At the same time, German assistance is also coming through some centrally sponsored schemes.

III. Terms and conditions of assistance:

Financial Assistance is provided as soft loans, grants, mixed credits (soft loans combined with market funds), interest-subsidised loans etc.

Soft loans are available at an interest rate of 0.75% p.a. with a repayment period of 40 years including a grace period of 10 years. These loans also carry a commitment charge of 0.25% on the undisbursed amount, which is leviable three months after the signing of the loan agreement.

Technical assistance is provided in the form of grants.

IV. Commitments and Disbursements:

Details of commitments and disbursements of German assistance during the last five years are given below:

(DM/EURO Million)

* including re-programmed funds

V. Recent Developments:

The Indo-German Annual Negotiations on Bilateral Development Cooperation were held in New Delhi on January, 14-16, 2004. During these negotiations, Germany has made fresh commitments as under:

Note: (conversion rate used : 1 Euro = Rs.53)

Website of German Embassy: www.germanembassy-india.org

1. Denmark’s development assistance to India, dating back to 1963, has been in the form of grants and soft loans provided for local cost projects relating to poverty alleviation and social development.

2. The total disbursement of Danish assistance routed through Government of India account during the last financial year (FY 2002-03) was Rs.54.75 crores. Two grant agreements worth Rs.29.34 crores were signed with Denmark during 2002-03. The assistance disbursed in 2003-04 is Rs.31.65 crores up to November, 2003. During 2003, agreements for Phase-II of two ongoing projects were signed i.e. Comprehensive Watershed Development Project, Phase II in Madhya Pradesh and Revised National TB Control Programme, Phase II in Orissa.

1. The French development assistance has been normally received in the form of mixed credits of Treasury soft loans and export (commercial) credits, and tied to projects involving supply of French goods and services.

2. During 2002-03, Euro 10.67 million (Rs.51.67 crores) was received as financial assistance from France. A protocol for an amount of Euro 4.56 million for "Digital Mapping & Information System for Bangalore Metropolitan Areas" project was signed on 4.2.2003. During 2003-04, Euro 4.60 million (Rs.24.51 crore) has been received up to November 2003.

1. The Italian bilateral development assistance to India, dating back to 1976, has been mostly in the form of suppliers’ credit. The Water Supply and Solid Waste Management Project in West Bengal is being funded by an Italian loan of about Lira 50 billion. There was no disbursement of Italian assistance through Government of India during 2002-03 and 2003-04.

1. The Netherlands had been extending bilateral development assistance to India since 1962-63 in the form of General Purpose Credits, Debt Relief Assistance, Suppliers’ Credits (Financial Export Credits) and Grants. Grants were extended for local expenditure and technical assistance. The Dutch assistance has been received for projects in the environment, drinking water supply, irrigation and water transport and agriculture sectors.

order of NOK 5.50 million ( 1 NOK = Rs. 6.75). There was no disbursement through GOI’s budget during 2003-04.

1. Swedish bilateral development assistance for India dates back to 1964. After 1976, Swedish assistance was in the form of grants availed for mutually agreed projects. Swedish Government also extended soft loans for large power sector projects in the past.

2. The priority areas of Swedish assistance were primary health, reproductive health, environment and urban development with focus on water sanitation and waste management. There was no disbursement under Swedish assistance through GOI’s budget during the last two years.

1. The Government of Switzerland started its bilateral development cooperation with India in 1960. During 2002-03, an agreement amounting to Rs. 4.32 crores (SFR 3.39 million) for ISP Sikkim project was signed with Switzerland. There has been no disbursement of Swiss assistance through GOI during 2003-04.

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