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India Pledges Aid Package for Tsunami Victims

India's cabinet has set out a reconstruction package for areas on its coast hit by the tsunami.

The $600 million package will be used to rehabilitate communities hit by the deadly tsunami that slammed along the coast of four southeastern states.

Nearly 40 percent of the funds will be used to buy boats and nets for the battered fishing communities of Tamil Nadu, Andhra Pradesh, Kerala and Pondicherry.

Tens of thousands of fishermen lost their livelihoods when the waves wrecked their boats. Most of the fishermen have not been out to sea since the disaster struck.

The funds also will be used to repair and restore damaged fishing harbors and docks. The government also plans to build more than 150,000 houses for families whose homes were washed away by the waves.

India's Finance Minister P. Chidambaram says the country's large economy will be able to generate sufficient funds to help the victims rebuild their lives and businesses.

A South Asia expert at the Confederation of Indian Industry in New Delhi, T.K. Bhaumik, said the growing economy has given the country the ability to cope. "We have enough resistance within the system, financial, material and other things. We have the necessary internal strength and the ability to handle a situation like the tsunami. As of now, we feel very confident that, yes, we can handle it," he said.

The government also soon plans to announce a rehabilitation and reconstruction package for the offshore Andaman and Nicobar Islands, which lie more than 1,200 kilometers east of the mainland and also were hit hard by the tsunami.

The government has estimated the overall cost of reconstruction at nearly $2 billion.

India has refused financial assistance from foreign governments, but says it may seek assistance from multilateral institutions such as the World Bank and Asian Development Bank for reconstruction projects.

Experts say the disaster will not cut India's expected economic growth of around seven-percent this year. But there are worries that the cost of tsunami reconstruction will make it difficult to cut a fiscal deficit that is running at nearly five-percent.

More than 10,000 people died in India, more than 5,000 are missing and tens of thousands are homeless.

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