French funding agency Agence Francaise de Developpement (AFD) has agreed to provide a loan of around €180 million (approximately Rs.1,314 crore) for Kochi Metro Rail’s 11-km-long Kakkanad extension that is slated to cost Rs.2,024 crore.
They have offered the loan for extending the metro from International Stadium, Kaloor to Infopark via Kakkanad for a 25-year tenure at an interest rate of 1.35 per cent (linked to EURIBOR). The normal tenure for such loans for urban infrastructure is 20 years.
“It is a matter of pride for Kochi Metro Rail Limited (KMRL) that AFD has agreed to this offer. This is an indication of the funding agency’s faith in KMRL’s capabilities and its objectives,” said Elias George, managing director of the metro agency.
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The loan also includes €22 million to promote non-motorised transportation from 20 metro stations, pedestrianisation of M.G. Road and improvement of Aluva, Edappally and Vyttila junctions.
The decision comes in the wake of the seventh annual negotiation meeting between the Ministry of Finance, Government of India and AFD that took place in Paris on November 9 and 10. It was attended by Mr. George and S. Selvakumar, Joint Secretary, Union Ministry of Finance.
The stakeholders also reviewed the present status of the Kochi metro project, for which the AFD has extended a loan of about Rs.1,500 crore. They also took stock of the modalities for the Rs.2,024-crore Kakkanad extension, said a KMRL press release.
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Low-cost project
Quoting an urban transport expert at AFD’s head office in Paris, KMRL officials said as per AFD’s worldwide assessment, Kochi Metro is, as of now, the lowest-cost metro-rail project globally, while at the same time adhering to global-quality standards.
Though the Kakkanad extension proposal is yet to be formally approved by the Government of India, the AFD has also agreed, as a special case, to procure all formal approvals of the agency’s Board well in advance, to prevent delay in implementing the extension. It was expected that the AFD’s Board would clear the proposal in December 2016, said the press release.