NEW DELHI: India's flood-ravaged Kerala state will seek to borrow more than 100 billion rupees (US$1.4 billion / £1.1 billion) to finance reconstruction work after a disaster that has claimed nearly 400 lives, its chief minister said on Tuesday.
The proposed loan is part of a special package that the southern state, which estimates it has suffered damage of at least 200 billion rupees, will seek from Prime Minister Narendra Modi's government for rebuilding efforts, minister Pinarayi Vijayan said.
Kerala will ask Modi's government to raise the state's borrowing ceiling to 4.5 percent of its GDP from 3 percent, which will help raise an additional 105 billion rupees from the market, Vijayan said.
"Our aim is not merely a restoration of the state to pre-flood times, but the creation of a new Kerala," Vijayan told reporters.
The worst floods in the state in a century claimed 383 lives, razed tens of thousands of homes, and washed away roads and bridges. Around 1.3 million are sheltering in thousands of relief camps.
The federal government has classified the floods as a "calamity of severe nature," and has committed 6 billion rupees in interim relief so far. Food Minister Ram Vilas Paswan said the government will provide as much help as possible.
Authorities are handing out medicines and disinfectants to ward off diseases as a huge clean-up gathers pace.
The federal government has sent tonnes of emergency drugs and bleaching powder, besides supplying tablets for water purification, though J.P. Nadda, federal health minister, said no outbreak of communicable disease had been reported yet.
The United Arab Emirates said it will provide 7 billion rupees to the state. "Kerala has a special relationship with the UAE, which is a home away from home for Malayalees," Vijayan said.
Several Gulf countries have a sizeable population of Keralites as expatriate workers. Since the 1960s, remittances from the Gulf have been the backbone of Kerala's economy, making up a third of its gross domestic product.
India said on Tuesday it plans to set up a cyclone warning centre in Kerala's capital Thiruvananthapuram in a month's time, as several tropical cyclones and severe weather events have recently struck the state and neighbouring Karnataka coasts.
While the state's road network will take time to return to normalcy, almost all train services, which had been shut since Aug. 16 following flash floods and landslides, have been restored.
The state plans to hold a special assembly session on Aug. 30 to discuss relief, rehabilitation and reconstruction.
(Reporting by Malini Menon; Editing by David Holmes)