Tripura CM seeks removal of ceiling on externally aided projects to accelerate development
Shillong, June 19
Tripura Chief Minister Manik Saha on Friday highlighted the transformative role of Externally Aided Projects in the state's development and urged the Union Government to remove the existing ceiling on EAP borrowings for North Eastern States.
Saha was addressing the seminar on 'Leveraging Externally Aided Projects (EAPs) in the North Eastern States' in the presence of Union Finance Minister Nirmala Sitharaman in Shillong, Meghalaya.
Saha said that Tripura has been at the forefront of leveraging externally aided projects from agencies such as the World Bank, the Asian Development Bank (ADB), Indo-German Development Cooperation, and the Japan International Cooperation Agency over the past two decades. These partnerships have significantly contributed to the state's socio-economic progress while also strengthening administrative and institutional capacities, a release said.
He said the strategic collaboration with the ADB, particularly through its North East Economic Corridor Study, has identified substantial opportunities for investment in industrial infrastructure, urban development, roads, power, tourism, and healthcare across Tripura.
Saha further said that reflecting the State's rapid economic growth, Tripura's Gross State Domestic Product (GSDP) has nearly doubled from Rs 55,984 crore in 2019-20 to Rs 1,00,795 crore in 2025-26. Similarly, annual capital expenditure has witnessed a remarkable increase from Rs 2,079 crore in 2021-22 to a record Rs 10,478 crore in 2025-26, demonstrating the enhanced capacity of the State administration to effectively absorb and utilize development funds.
"Private investment has also gained significant momentum, with Memorandums of Understanding worth approximately Rs 30,000 crore signed over the past year and projects exceeding Rs 8,000 crore already grounded. This surge in investment underscores the need for substantial public infrastructure in sectors such as industrial estates, transportation, power, tourism, and water resources", said the Chief Minister.
He informed that currently, Tripura is implementing eight major Externally Aided Projects (EAPs) covering industrial infrastructure, urban development, tourism, climate resilience, and the socio-economic advancement of Scheduled Tribes.
Saha also pointed out that while EAPs are generally structured with an 80:20 Centre-State funding pattern, the requirement to bear substantial costs related to land acquisition, forest land diversion, and utility shifting effectively increases the state's contribution, making the practical ratio closer to 60:40.
Given these realities, Saha urged that the ceiling imposed on externally aided projects since 2023-24 be removed and that future borrowing limits be determined based on each state's administrative capability and fund absorption capacity rather than arbitrary caps. Such a policy, it was emphasised, would be in line with the true spirit of the Union Government's Act East Policy and would enable North Eastern States to accelerate infrastructure creation and economic growth.
Saha has expressed its sincere gratitude to Prime Minister Narendra Modi and Union Finance Minister Nirmala Sitharaman for their unwavering support in sanctioning several externally aided projects that have helped place Tripura on a strong growth trajectory.
He also highlighted concerns arising from the discontinuation of the Revenue Gap Grant following the recommendations of the 16th Finance Commission. While appreciating the Government of India's support through the 'Pride of Hills' initiative, it was requested that allocations under the scheme be enhanced to adequately meet the state's committed expenditure requirements.
"Despite various challenges, Tripura reaffirmed its commitment to building robust infrastructure and creating greater employment opportunities through investments in industrial development, road connectivity, skill development, renewable energy, tourism, and other priority sectors, with the continued support of the Union Government," said the Chief Minister.
— ANI
Reader Comments
All this talk of World Bank and ADB projects is good, but I hope these loans don't become a debt trap for small states like Tripura. We've seen how infrastructure loans can pile up. The state should focus on improving tax collection and domestic revenue first, rather than just borrowing more. 🤔
This is exactly the kind of proactive governance we need in the Northeast. The Act East Policy needs strong infrastructure backbone - better roads, power, and industrial zones. Tripura's Rs 30,000 crore MoUs show private investors are confident. Removing the ceiling will accelerate this momentum. Well said, CM Saha! 👏
I'm from Tripura and I've seen the difference ADB-funded roads have made in our district. But the CM's point about the Revenue Gap Grant being discontinued is worrying. The 'Pride of Hills' scheme is good but needs more funds. The 16th Finance Commission should reconsider this - small states have unique challenges.
Impressive numbers from Tripura - GSDP doubling and capex jumping 5x in just a few years. If the state can maintain this absorption capacity, removing the ceiling makes economic sense. But the Centre needs to ensure other NE states aren't left behind in the rush for EAPs. Balanced regional development is key.
While I support more development funds, I worry about the environmental impact of all these externally aided projects. The CM mentioned forest land diversion costs - are we sacrificing our forests for roads and industries? Need more details on how these
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