The Asian Development Bank has decided to invest $8 billion in India over the next four years (2003-06), virtually doubling its current annual commitment of about $1 billion.

Louis de Jonghe, the bank's country director for India, told reporters today, they were also hopeful of hitting the market with their $100 million bond programme within the current fiscal.

Yoshiro Iwasaki, director-general for South-Asia regional department, Asian Development Bank, said over 70 per cent of the assistance package of $8 billion would be invested in roads, railways, inland waterways, power and gas distribution systems.

He said the board of directors were scheduled to consider the country strategy and programme, which included $53 million grant by March.

Speaking on the Kelkar report on tax reforms, Sudipto Mundle, the bank's chief economist for India, said the emphasis on reforms in tax administration and the principle to cut off exemptions were steps in the right direction. He offered help from the bank in computerisation of the tax department.

He supported the task force recommendations on farm tax saying the measure would check underreporting of non-farm income that goes under the cover of farm income.

About the size of the fiscal deficit of the Centre, Iwasaki said he was hopeful that the steps being taken by them would have a positive impact over the next two years.

He welcomed the move to tax the buoyant service tax sector and said the projected 8 per cent annual gross domestic product growth rate by the country was a difficult but achievable target.

He also said the multilateral institution had already got a clearance from the Reserve Bank of India and the finance ministry to launch its $100 million debt paper in the country within the current fiscal year.

Jonghe said the paper would be of about seven year's tenor and said talks were on to finalise the rate of interest. He said the sum would be used to finance the private sector projects of the bank.

Along with infrastructure, ADB would finance an irrigation project in the country in Chhattisgarh. Mundle said this was a step towards direct involvement in poverty-reduction programmes in the country.