ADB announces $10 billion plan to transform India's urban infra, services

Business Standard

3 days ago

Asian Development Bank (ADB) President Masato Kanda has announced a five-year plan to mobilise up to $10 billion, including third-party capital, to enhance the India's urban infrastructure and services.
The plan was unveiled after Kanda's meeting with Prime Minister Narendra Modi. The plan will focus on metro expansions, new Regional Rapid Transit System (RRTS) corridors, and investments in sustainable urban development. "Cities are engines of growth," Kanda said after the meeting. 'ADB will mobilise capital, accelerate delivery, and scale solutions that keep India's urban economy moving and people thriving on the road to Viksit Bharat @ 2047.'
Backed by Urban Challenge Fund
At the heart of the initiative is support for India's flagship Urban Challenge Fund (UCF), which aims to attract private investment in city infrastructure. ADB will channel funds through sovereign loans, private sector financing, and technical assistance, including $3 million earmarked for developing bankable projects and building capacity in state and urban local bodies.
Recent analytical work by ADB has already laid the foundation for the UCF in 100 cities, focusing on growth hubs, creative city redevelopment, and water and sanitation improvements.
Urban transport, clean energy in focus
India's urban population is projected to exceed 40 per cent by 2030. Responding to this rapid growth, ADB will extend its existing urban transport footprint, which includes $4 billion committed over the past decade to metro and RRTS projects in eight cities. These include the Delhi–Meerut RRTS, Mumbai Metro, Chennai Metro, and Bengaluru Metro, designed to reduce congestion and improve access for marginalised communities, including persons with disabilities.
Kanda visited the Delhi–Meerut RRTS, India's first of its kind, and met women who benefited from project-linked skills training. He also toured Gurugram-based ReNew Power to discuss strengthening partnerships in renewable energy.
Commitment to rural development
Earlier this week, Kanda met Union Finance Minister Nirmala Sitharaman and reiterated ADB's readiness to lend between $4 billion and $4.5 billion annually in sovereign loans, along with $1 billion in private sector funding. ADB will also intensify support for rural development, including food system improvements, entrepreneurship, and employment generation.
'Our shared agenda centres on urban transformation, private sector development, and skills programmes that strengthen India's manufacturing base,' Kanda said.
ADB's long-term partnership with India
Kanda also met Union Housing and Urban Affairs Minister Manohar Lal Khattar to explore expanding metro networks, transit-oriented development (TOD), and scaling rooftop solar projects. ADB is engaging with CEOs from infrastructure, finance, agriculture and social sectors to attract greater private participation in infrastructure growth.
Under ADB's country partnership strategy for India, 2023–2027, it stands ready to provide more than $5 billion in financing each year, including about $1 billion in nonsovereign operations to catalyse additional private investment.
ADB, which began operations in India in 1986, has committed $59.5 billion in sovereign lending and $9.1 billion in nonsovereign investments as of April 2025. The active sovereign portfolio comprises 81 loans totalling $16.5 billion as of April 2025.