The upgradation programme formed a part of the Financial Institutions Reforms and Expansion (FIRE) project funded by the United States Agency for International Development (USAID).

The Urban Infrastructure Development, which formed part of FIRE, however, will continue as the US administration has decided to treat it as a humanitarian aid project which is exempt from the purview of sanctions, a top official in USAID told PTI. "We have decided not to wind up our operations entirely as the urban infrastructure and sanitation projects fall within the definition of humanitarian aid," the official said.

Various institutions and stock markets including market regulator SEBI, BSE and NSE benefited from the consultancy and inputs given by the project since1993.

Ahmedabad Municipal Corporation, which was only the second civic body in the world to mobilise funds through a public issue of bonds, (after Shanghai Municipal Corporation in China) was also assisted by FIRE, the official noted.

Under the FIRE project, USAID has so far pumped in over US$ 20 million of which more than US$ 13 million were used in the development of stock market infrastructure in India. About US$ 7 million was put in assisting various municipal corporations including Ahmedabad Municipal Corporation in their development plans.

Consultancy major Price Waterhouse was doing the projects for FIRE, the official said adding that chief of projects in India, Dennis Grubb would also leave the country on August 14.

The USAID official said that a key area hit following FIRE pulling out of the country would be the development of an active secondary debt market. He said fire was instrumental in the formation of fixed income money market derivatives association (FIDMA) which has as its membersmajor public sector and foreign banks. The organisation, which came into effect in June 1998, was assisted by FIRE to develop an active debt market for government securities and other debt instruments.

The USAID official said that FIRE officials had assisted SEBI officials in framing guidelines for various capital market regulatory aspects including derivatives trading. He said the FIRE project, initially for five years, had received an extension from the US government. However, this decision was reversed following the nuclear tests.