Asian Development Bank (ADB) has signed an agreement to provide a loan of $200m to enhance road infrastructure in the Indian state of Maharashtra.

According to the agreement signed with the Government of India, the funds will be used to improve rural roads in 34 Maharashtra districts.

The contract was signed by India’s deputy country director and ADB-India resident mission Sabyasachi Mitra on behalf of ADB, while Department of Economic Affairs additional secretary Sameer Kumar Khare represemented the government.

Sameer Kumar Khare said: “Improving rural connectivity is one of the key priorities of the Government of India, which will help enhance rural livelihoods and alleviate poverty among remote rural communities in project districts.

“Enhanced road connectivity and better access to markets will help the farmers increase agricultural productivity and incomes.”

Under the Maharashtra Rural Connectivity Improvement Project, the roads will be upgraded to ‘all-weather standards’.

The money will be used to improve the conditions of rural roads spanning 2,100km. The contract also includes five-year maintenance of the finished roads.

Along with the loan, the Maharashtra Rural Road Development Association (MRRDA) has been provided with a grant of $1m to aid the association in road safety, road asset management, web-based real-time project monitoring and climate-proof design and construction.

Rural roads in Maharashtra account for two-thirds of the state’s road network. It is estimated that around half of the roads are unsuitable for traffic during monsoons as most are unsealed.

Last month, ADB signed an agreement to provide $23m in funding to GR International (GRIL) in order to expand India’s road infrastructure.

In June, ADB granted a $350m loan for the rehabilitation and modernisation of state highways and major district roads in the Indian state of Chhattisgarh.