France to decide on aid for Kochi metro by year-end

The board of Agence Française de Développement (AFD, or French Development Agency), a public institution providing development financing, will take a final call on extending financial assistance to the Kochi Metro Rail project by the end of this year.

The decision hinges on a detailed analysis by a team of town planning and rehabilitation and resettlement experts slated to visit the city in September to look into the social and environment aspects of the project.

The AFD board meeting likely to be held in December is expected to take the crucial decision.

KMRL managing director Elias George said the French financing agency was willing to provide a loan up to 150 million Euros but was sensitive about rehabilitation and resettlement and Environment Impact Assessment. Carbon emission and land filling were other areas of concern.

The loan will carry a 2 per cent interest rate and a repayment period of 20 years along with a moratorium of nine years.

Mr. George said he was hopeful of receiving funds by March next year.

He was addressing the media after holding elaborate discussions with AFD senior transport expert Xavier Hoang, regional director for South Asia Aude Flogny and project coordinator Gautier Kohler who are on a visit to the city.

The French officials said that the team set to visit the city in September would make a detailed investigation based on which the board would take a decision.

KMRL should be able to assuage the concerns of the French agency considering that it has already invited an Expression of Interest (EoI) from agencies of international repute for social and environment impact assessment in connection with Kochi Metro.

Fifteen companies have responded to the EoI and work will be awarded shortly to the short-listed company.

Mr. George expressed hope of receiving technical expertise from AFD along with the tranche of loan for the successful completion of Kochi Metro Rail.

Of the Rs. 2,170 crore KMRL is looking to borrow from outside, it expects the French agency to contribute half of it.

For the remaining 50 per cent, KMRL is exploring the scope for a loan from the Japan International Co-operation Agency (JICA).