Categories: AgreementsCurrent Affairs

France And Germany To Provide 100 Million Euros For AMRUT Mission Financing

France’s development agency, AFD, and Germany’s KfW Bank are reportedly in talks with India to extend a €100 million loan to support the country’s urban infrastructure plan, specifically the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) 2.0. Negotiations for the loan are scheduled for early 2024, with the signing expected to take place in February.

This collaborative effort follows their recent partnership on the City Investments to Innovate, Integrate and Sustain (CITIIS) 2.0 program, demonstrating a continued commitment to sustainable urban development in India.

CITIIS 2.0 Program

The CITIIS 2.0 program, a four-year initiative, focuses on urban renewal and sustainable waste management.
Both France and Germany have contributed €100 million each to this program, highlighting their shared commitment to fostering sustainable urban development in India.
The Union Cabinet approved the plan in May 2023, emphasizing its support for competitively selected projects promoting a circular economy, integrated waste management at the city level, climate-oriented reforms at the state level, and institutional strengthening and knowledge dissemination at the national level.

Previous Collaborations

France’s AFD and Germany’s KfW Bank have a history of funding urban transformation projects in India.
AFD’s participation in the CITIIS 1.0 program since 2018 and its contribution of technical expertise to the government’s Smart Cities Mission in cities such as Nagpur, Pondicherry, and Chandigarh demonstrate their commitment to India’s urban development.
Additionally, AFD has financed metro projects in various Indian cities, including Bengaluru, Pune, Surat, Nagpur, and Kochi, contributing to the enhancement of public transportation.

KfW Bank’s Strategic Investments in Indian Infrastructure

KfW Bank, specializing in official development finance, has also invested in metro projects in India and provided funds for the expansion of the suburban rail system in Bengaluru.
Their upcoming venture involves financing India’s PM E-Bus Sewa scheme, which aims to introduce 10,000 electric buses in nearly 170 Indian cities.
This initiative aligns with the government’s goal of promoting sustainable and eco-friendly public transportation.

AMRUT 2.0 and Investment Opportunities

Launched in October 2021 for a five-year period (FY22 to FY26), AMRUT 2.0 aims to provide universal coverage of sewerage and septage management systems in 500 cities.
By the end of FY23, the housing and urban affairs ministry had approved State Water Action Plans (SWAP) for 6,527 projects costing ₹1.29 trillion.
Detailed project reports for 2,058 plans worth ₹36,481.47 crore have been approved by states and union territories.
According to the Department for Promotion of Industry and Internal Trade (DPIIT), there are currently investment opportunities worth $7.5 billion under the infrastructure mission.