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Chhattisgarh gets Centre’s nod for World Bank funded school project

  • Category
    Polity & Governance
  • Published
    16th Jul, 2022

Context

The Chhattisgarh Government has received in- principal nod from the Centre to go ahead with a $300 million school education project which State is negotiating with the World Bank.

About

  • The initiative will allow the Chhattisgarh Government to borrow $300 million over a period of five years.
  • It will allow the state to pay significantly lower than market rates of interest, and repay it over a period of 20 years.
  • This will boost the Chhattisgarh’s Education system.

What is an In-principal nod process?

  • An in-principle nod means that the Centre has no objection to the State borrowing money from an external financial institution such as the World Bank.
  • This is not the final approval but it paves the way for the State to proceed with subsequent discussions.
  • Similarly, the World Bank has also approved in-principle that it’s willing to fund the project.

Procedure to be followed to sanction funds by the World Bank

  • A World Bank team’s visit to Chhattisgarh. 
  • Then a Detailed Project Report (DPR) will be prepared with the Centre and the World Bank, which will be put up before the World Bank Board and the Centre for a final approval.
  • The DPR will also have a detailed plan on how the money will be spent.

Contributions of World Bank for Education in India

  • The World Bank has been associated with India’s school education system since 1994.
  • The $500 million Strengthening Teaching-Learning and Results for States Program (STARS) of 2021, to improve the quality and governance of school education in six Indian States.

World Bank

  • The International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA), two of the World Bank Group's five international entities, are known as the World Bank.
  • It was formed with the International Monetary Fund at the 1944 Bretton Woods Conference.
  • The World Bank Group is a global partnership of 189 countries and five constituent organisations committed to alleviating poverty and promoting prosperity.
  • The World Bank Group's five development institutions are:
    • International Bank for Reconstruction and Development (IBRD)
    • International Development Association (IDA)
    • International Finance Corporation (IFC)
    • Multilateral Guarantee Agency (MIGA)
    • International Centre for the Settlement of Investment Disputes (ICSID)
  • Functions:
    • It helps creditworthy middle-income and low-income countries by providing loans, guarantees, advice services, and risk management tools.
    • IBRD finances investments in a variety of areas and provides technical assistance and experience at all stages of a project's development.
    • It also aids governments in improving their countries' investment climate, eliminating service delivery bottlenecks, and strengthening institutions and policies.
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