Lusaka, Zambia: India has extended a $75 million (about Rs350 crore) line of credit to Zambia, which is augmenting its power generation capacity and other infrastructure to meet demand from copper miners.
This is in addition to the $50 million line of credit agreement signed between the government of Zambia and Export-Import Bank of India for the 120MW Itezhi Tezhi hydropower project, a venture between Zambia Electricity Supply Co. Ltd (Zesco) and Tata Africa Holdings (SA) Pty Ltd.
Growing demand: A copper mine near Kitwe, Zambia. The country is a major exporter of copper and its exports are expected to grow. Bloomberg
An line of credit is a specified amount of money a borrower may obtain without a special credit check..
“We will now await proposals from Zambian authorities in the area of health, infrastructure, education among others to utilize this line of credit,” Vivek Katju, secretary (west) in ministry of external affairs, said on Wednesday. Katju is accompanying vice-president Hamid Ansari on a visit to Zambia, Malawi and Botswana.
“This $50 million will go towards Zesco’s equity participation in this (Itezhi Tezhi) project,” Katju said. Zambia’s power demand is about 1,500MW.
“The vendors for the project have been finalized,” said Raman Dhawan, managing director, Tata Africa Holdings. He declined to name them.
India plans to offer credit lines of about $5.4 billion by 2012 to woo African countries. It has so far extended lines of credit of about $1 billion and will give an additional grant of $500 million to these nations.
“There is now a need, as our vice- president put it, to reinvigorate and re-energize the relationship between the countries. That process began in 2008 with the India-Africa forum summit,” Katju said.
India has in recent years scrambled to come up with a cohesive Africa policy to catch up with its larger neighbour China to tap the energy and mineral resources of the continent.
Zambia is a major exporter of copper and its exports are expected to grow because global demand for the metal is picking up.
India’s trade with Africa is about $39 billion, including $206.32 million with Zambia.