BHUBANESWAR: The funds-starved Orissa government is likely to get around Rs 1000 crore assistance from the World Bank during the current fiscal.

A World Bank delegation assured this to chief minister Naveen Patnaik here on Thursday. The aid would be part of the Orissa Socio-Economic Development Programme, under which the state had earlier got Rs 600 crore to take up anti-poverty and other developmental activities.

Sharing the impressions about the financial and development scenario in the state, the four-member World Bank team expressed their satisfaction about the corrective steps the state government has taken to improve its fiscal situation.

The visitors, who reviewed different aspects of the state’s administrative and financial reforms during the past week, particularly appreciated the government’s success in reducing non-plan expenditure and substantially increasing the tax as well as non-tax revenue. The visitors further agreed to the chief minister’s proposal to early release the loan amount expeditiously, said official sources.

World Bank team member Ravi Shankar had earlier told reporters that the progress made by Orissa is certain aspects like pace of utilization has been quite satisfactory, but more needs to be done to reach the goal of nil revenue deficit by 2008-09. He also pointed out that unlike previous years when almost the total budget was going towards meeting the salary and pension liabilities, some funds are now being provided to the development sector as well.

"The reforms are on track, but to achieve more the efforts need to be sustained,"he stressed. He, however, refused to spell out the exact sum of assistance the World Bank would extend this fiscal, hinting that it could be around Rs 1000 crore.

Orissa, for the record, is presently in a debt trap and has incurred a loan of around Rs 34,000 crore to meet its requirements. In fact, considering the precarious state of finances, the World Bank has started extending overall budgetary support to the state government since 2004-05. Finance minister P C Ghadei told ToI, "A part of the loan received under the OSEDP would be used be debt-swapping, while the rest will be used as budgetary support to meet our socio-economic needs as envisages under the Millennium Needs Programme."

According to development commissioner Ajit Tripathy, who haas been actively involved in the discussions with the World Bank representatives, the OSEDP is being implemented with a view to accelerate the broad-based economic growth by improving the investment climate and strengthening infrastructure. Reducing the financial burden so as to increase resource allocation towards development needs, lessening bureaucratic interference, bringing about greater transparency, attracting more private investment, improving the regulatory framework of private enterprises, among others, are also major aims of the programme.