Countries and Regions

	Table of Contents
p. 19 of 20 BACK | NEXT I. Country Performance Assessment II. Country Operational Strategy III. Sector Strategies IV. Regional Cooperation V. Donor Activities and Aid Coordination VI. Cofinancing and Catalyzing External Resources VII. ADB’s Operational Program VIII. Economic and Sector Work Program IX. Local Cost Financing

Country Assistance Plans - India

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VIII. Economic and Sector Work Program

95. ADB is undertaking comprehensive and detailed economic and sector work, which forms the basis for its support for policy reform, capacity building, and institutional strengthening in India. The economic and sector work also provides assessment of the overall consistency of economic and structural policies and their developmental impact on efficiency and sustainability of economic growth, a prerequisite for progress in reducing widespread poverty.

96. Economic and sector work will include updating of ADB's in-house macroeconomic model of the Indian economy that will be used, inter alia, for the annual Country Economic Review and the Asian Development Outlook. The model will also enable the analysis of policy consistency and country risk, thereby providing important feedback on the absorptive capacity of external assistance and guidance on the scope of ADB's future lending operations. The macroeconomic analysis will be complemented by detailed sector studies, linked to ADB's proposed lending operations over the next few years. These will include: financial sector strategy with focus on the development of the long-term debt market; the design and implementation of further policy reforms in the power sector, focusing inter alia on the restructuring and privatization of transmission and distribution while also addressing the vexed issue of power subsidies; and capacity building for efficient public sector management at the national and state levels and for local government resource mobilization. Further, work on water resource sector could also provide background for strengthening ADB assistance on environment including natural resource management. A state economic profile for Kerala, ADB's third focal state, is also being prepared in 2000 to provide a comprehensive economic and sector review.

97. To guide ADB's expanding operations in urban development and the environment sector, an environment profile was completed in 1999. To further strengthen ADB's support for social sector development, a social sector profile and gender study will be prepared which will form the basis for monitoring and reviewing India's progress in these areas, as well as to ascertain if ADB's proposed lending and TA activities can be designed and targeted in such a way as to enhance ADB's contribution and thus more effectively complement the activities of other donors. Work will also be intensified in support of ADB's evolving possibilities for natural resource management as part of ADB's state-level operation (see para. 66).

98. An important component of the economic and sector work in 2000-2001 is the assessment of poverty, the development of a conceptual framework for poverty reduction at the national and state levels, and improvement in the design of ADB projects for stronger poverty impact. Further sector work is also being undertaken on reducing poverty in urban India. To strengthen the analytical basis on locational aspects of poverty distribution in India, work on poverty mapping is being initiated in 2000. These studies as well as the above work on sector strategies will feed into a review of the Country Operational Strategy, expected to be completed in 2001, and will assist in reassessing ADB's medium- to long term operational focus at the national and state levels.

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