Asian Development Bank Pledges $250 Million Boost For India's Industrial Corridors

The Asian Development Bank (ADB) has approved a $250 million policy-backed loan to accelerate the advancement of industrial corridors in India. The primary objective is to boost the competitiveness of the manufacturing sector, strengthen national supply chains, and foster connections with regional and global value chains.

Furthermore, the initiative aims to create a significant number of high-quality jobs.

ADB states that this financial support aligns with the National Industrial Corridor Development Program (NICDP), initiated by the Government of India in 2016 and later updated in 2020 to enhance the planning and management of industrial economic clusters.

The infusion of funds by ADB reinforces the effective implementation of NICDP.

According to Sameer Khatiwada, ADB Senior Public Management Economist, the program is anticipated to stimulate job creation across diverse sectors, including agribusiness, automotive, electronics, food and beverages, heavy machinery, pharmaceuticals, and textiles.

Khatiwada emphasises that this program will lead to the increased formalisation of labour, heightened productivity, and higher wages—factors directly contributing to poverty alleviation in the corridor states.

The envisioned industrial corridor includes an efficient multimodal transport network within a designated geographic area, supported by quality infrastructure, logistics, skill development, and a business-friendly policy framework. It aims to establish distribution networks connecting production centres, urban hubs, and international gateways such as ports and airports.

The loan specifically supports subprogram 2 of the Industrial Corridor Development Program, focusing on the development of multimodal logistics infrastructure under the government's Prime Minister Gati Shakti platform.

The initiative highlights gender equality in manufacturing and corridor development, offering training and upskilling programs for workers in industrial corridors.

In addition, the second subprogram aims to cultivate alternative financing solutions, including green finance, for industrial cluster development. It prioritises industrial workplace safety and integrates environmental and climate change practices.

To enhance the investment climate and facilitate ease of doing business, the program introduces a synchronised central and state-level single-window clearance system and adopts digital processes to streamline logistics, providing private investors with access to crucial data.

This recent financial injection builds upon the success of the $250 million Subprogram 1 loan sanctioned by ADB in October 2021, which played a pivotal role in reinforcing policy frameworks for NICDP and contributed to the development of 11 industrial corridors.

National Industrial Corridors

The National Industrial Corridor Development Programme stands as India's most ambitious infrastructure initiative, with a vision to transform emerging industrial cities into "Smart Cities" by integrating cutting-edge technologies across various infrastructure sectors.

The National Industrial Corridor Programme unfolds numerous projects focused on cultivating futuristic industrial cities within the country.

The objective is to establish these cities as globally competitive manufacturing and investment hubs.

The government of India is developing 11 Industrial Corridor Projects as part of the National Industrial Corridor Programme across the country in a phased manner. They are given below

1. Delhi Mumbai Industrial Corridor (DMIC)

2. Chennai Bengaluru Industrial Corridor (CBIC)

3. Amritsar Kolkata Industrial Corridor (AKIC)

4. East Coast Industrial Corridor (ECIC) with Vizag Chennai Industrial Corridor (VCIC)

5. Bengaluru Mumbai Industrial Corridor (BMIC)

6. Extension of CBIC to Kochi via Coimbatore

7. Hyderabad Nagpur Industrial Corridor (HNIC)

8. Hyderabad Warangal Industrial Corridor (HWIC)

9. Hyderabad Bengaluru Industrial Corridor (HBIC)

10. Odisha Economic Corridor (OEC)

11. Delhi Nagpur Industrial Corridor (DNIC)

This strategic initiative not only aims at job creation but also anticipates robust economic growth, fostering comprehensive socio-economic development.