India–ADB $2.2 Billion Loan Agreements

17.12.2025

India–ADB $2.2 Billion Loan Agreements

Context

In December 2025, the Government of India and the Asian Development Bank (ADB) signed five major loan agreements totaling over $2.2 billion. This significant financing package is designed to support India’s national flagship programs in skilling, clean energy, and healthcare, alongside critical infrastructure projects in Assam, Tamil Nadu, and Meghalaya.

About the News

Background:

The agreements were signed by Saurabh Singh (Deputy Secretary, Department of Economic Affairs) and Aarti Mehra (Officer-in-Charge, ADB India). The package aligns with the Country Partnership Strategy (2023–2027), which focuses on structural transformation and climate-resilient growth.

Key Features of the Agreements:

Skilling & Employability ($846 million):
- Supports the PM-SETU (Pradhan Mantri Skilling and Employability Transformation) program.
- Modernization of 650 Industrial Training Institutes (ITIs) across 12 states.
- Upgrading 5 National Skill Training Institutes into Centres of Excellence.
- Target: Improving employability for 1.3 million youth in sectors like EV mobility and renewable energy.
Rooftop Solar Expansion ($650 million):
- Financing for the PM Surya Ghar: Muft Bijli Yojana.
- Goal: Expanding solar access to 10 million households by 2027.
- Focus: Providing collateral-free, low-interest loans for middle and low-income groups.
Assam Healthcare Augmentation ($398.8 million):
- Focuses on tertiary healthcare in Assam.
- Upgrading medical colleges in Guwahati, Dibrugarh, and Silchar.
- Strengthening medical education under the Srimanta Sankaradeva University of Health Sciences.
Chennai Metro Rail Project ($240 million):
- Tranche 2 funding for three new metro corridors.
- Includes 18 new stations with universal access and climate-resilient features.
Meghalaya Sustainable Livelihoods ($77 million):
- Focuses on ecotourism and climate-smart agriculture.
- Benefiting over 8,000 local and indigenous community members, specifically women.

About the Asian Development Bank (ADB)

Established: 19 December 1966.
Headquarters: Manila, Philippines.
Members: 69 countries (India is a founding member).
India’s Position: India is currently the largest recipient of ADB’s sovereign lending, accounting for nearly 14% of its total commitments.
Strategic Vision: Aligned with Viksit Bharat @2047, ADB aims to eradicate extreme poverty while promoting inclusive and sustainable development.

Significance of the Partnership

Aspect	Impact of 2025 Agreements
Human Capital	Shifts vocational training from traditional trades to high-tech manufacturing and green jobs.
Energy Security	Reduces dependence on the grid by incentivizing residential solar through decentralized financing.
Urban Mobility	Addresses "Last Mile" connectivity in Chennai through multimodal interchange upgrades.
Regional Equity	Targets the North East (Assam & Meghalaya) to bridge the healthcare and tourism infrastructure gap.

Way Forward

Execution Monitoring: Implementing Real-time MIS dashboards (as seen in the G-RaM G Bill) to ensure zero leakages in solar subsidies.
Private Capital Mobilization: Leveraging the Urban Challenge Fund to attract private investors into metro and waste management projects.
Gender-Inclusive Skilling: Ensuring at least 30% of the 1.3 million targeted youth for skilling are women, particularly in the renewable energy sector.

Conclusion

The $2.2 billion package marks a transition in ADB’s role from a traditional "infrastructure lender" to a "knowledge and transformation partner." By focusing on rooftop solar and high-end skilling, the partnership directly supports India's Nationally Determined Contributions (NDCs) and its journey toward a developed economy by 2047.

India–ADB $2.2 Billion Loan Agreements