Press release No.: IFAD/51/08

Rome, 17 October 2008 - A loan of US$30.3 million and a grant of US$600,000 to the Republic of India from IFAD will increase agricultural production and boost employment prospects in the ‘Mitigating Poverty in Western Rajasthan Project’.

The loan agreement was signed today in Rome by Shri Arif Shahid Khan, Ambassador to Italy and Lennart Båge, President of IFAD

The project will involve 95,000 poor households in the six poorest districts of Western Rajasthan; Jokhpur, Jaisalmer, Barmer, Pali, Sirohi and Jalor. The households include landless labourers, small and marginal farmers, owners of marginal land, traditional artisans, women and young people.

In Western Rajasthan, a harsh, arid climate and low rainfall contribute to the project areas’ core problems of severe lack of  water, poor agricultural and livestock productivity, limited income generating opportunities and a patriarchal system that discriminates against women.

The project will increase income-generating activities primarily in the livestock, handicraft and tourism sectors. It will: improve farming practices through watershed management; promote both self employment and wage employment opportunities; and provide access to financial services and markets. “This project has been designed in convergence with existing Government-funded schemes so as to maximize the effectiveness of public expenditure and ensure sustainability beyond project completion” said Mattia Prayer Galletti, IFAD’s Country Programme Manager for India.

Some of the innovative features of the project include piloting low-cost schemes for health insurance and dairy animal insurance and a new market-driven approach with partnership with private sector in the identification of viable income generating activities.

To date, IFAD has financed 22 programmes and projects in India, approving loans for a total of US$595.3 million.

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IFAD was created 30 years ago to tackle rural poverty, a key consequence of the droughts and famines of the early 1970s. Since 1978, IFAD has invested more than US$10 billion in low-interest loans and grants that have helped over 400 million very poor rural women and men increase their incomes and provide for their families. IFAD is an international financial institution and a specialized United Nations agency. It is a global partnership of OECD, OPEC and other developing countries. Today, IFAD supports more than 200 programmes and projects in 85 developing countries and one territory.