India and Sri Lanka on Monday signed a commercial agreement for construction of a railway line between Omanthai and Pallai in the war torn Northern Province. A press statement by the Indian High Commission said that the pact was signed at the Ministry of Transport in the presence of Sri Lanka Minister of Transport Dullas Alahapperuma and High Commissioner of India Ashok K. Kantha on behalf of IRCON International (a Government of India Undertaking which will construct the railway line) by S.L. Gupta and on behalf of the Sri Lanka Railways by P.P. Wijesekara. “The agreement is backed by a Government of India line of credit for $185 million. It is part of a larger package of assistance directed at the rehabilitation of railway infrastructure in the Northern Province of Sri Lanka, for which the Government of India has committed a total amount of $425 million in lines of credit,” it said. The latest agreement follows similar agreements that have been signed earlier for the rehabilitation of the Southern Railway corridor, which had been extensively damaged in the 2004 tsunami. Under that agreement, India is assisting in the rehabilitation of the Colombo-Matara rail link through a line of credit of $167.4 million. Work on the Colombo-Kalutara sector of this line is already at an advanced stage. Speaking on the occasion, High Commissioner Kantha noted that the reconstruction of transport-related infrastructure was an essential requirement for the restoration of normal economic life in the Northern Province as it would both generate and support livelihood-related activities. The High Commissioner said that India remains committed to continuing its assistance to Sri Lanka as it undertakes the important and challenging task of reconstructing the Northern Province.

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