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India seeks $ 1.5 bn from aid agencies

India was in talks with the World Bank and other agencies this week for $1.5 billion in aid to rebuild devastated western Gujarat, which bore the brunt of last Friday's earthquake feared to have killed 20,000 people.

Individual countries, including the United States, Canada and Pakistan, offered financial help and relief teams.

The US Agency for International Development, the humanitarian arm of the US government, said on Sunday it would provide aid valued at $5 million and was working with Indian officials to determine their critical needs.

The financial markets face a week of uncertainty as the nation was still counting the cost of the killer earthquake and rescuers searched for more survivors.

If confirmed, the death toll would outstrip the numbers killed in a massive quake in Turkey in 1999, when more than 17,800 died.

Although firms with major operations in the quake zone reported their plants were not seriously damaged, market analysts said worries about the full extent of the quake and its total cost could push values down when markets opened on Monday.

The earthquake, measured at 7.9 on the Richter scale by the US Geological Survey, was the worst disaster to hit India in half a century.

Enormous reconstruction

Finance Minister Yashwant Sinha told reporters late on Sunday the requirement for funds for reconstruction was going to be "enormous". The government planned to ask $1 billion from the World Bank and $500 million from the Asian Development Bank.

Sinha said the situation was still unfolding but warned that the quake in Gujarat, the country's second most industrialised state, would have an impact on India's economy, already slowing because of high global oil prices and a weak rupee.

The World Bank pledged to stand by India.

"Our hearts go out to the thousands of people who have lost so much in a matter of seconds and we will continue to stand by the government and people of India as it seeks to clear the rubble of this devastating event," said World Bank President James D Wolfensohn in a statement issued in New Delhi.

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