The National Institution for Transforming India (NITI Aayog), Department of Expenditure under the Union Finance Ministry, and the Ministry of Railways have accorded Kerala Rail Development Corporation Ltd. (K-rail) the nod for mobilising funds from multilateral and bilateral agencies for the 529.45-km semi-high speed rail ‘SilverLine’ from Kochuveli to Kasaragod.
With this, K-rail, the joint venture between the State and Railways for cost-sharing rail projects, can ‘pose’ the loan request for availing itself of ₹33,700 crore as per guidelines of Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), German Development Bank (KfW) and Japan International Cooperation Agency (JICA). Official sources told The Hindu that all funding agencies, except KfW, had informally confirmed their willingness to provide loan for the SilverLine.
Funds
The ADB has offered to make available loan in two tranches of US $ 4,500 million and US $ 499.50 million (₹7,533 crore), AIIB US $ 500 million and JICA US $ 2.5 billion (₹18,892 crore). KfW is expected to make available loan of US $ 460 million (₹3,476 crore) for the ambitious project estimated to cost ₹63,941 crore as per current estimates. K-rail is hoping that it can secure US $ 4.46 billion (₹33,700 crore) from these four lending agencies for the project.
HUDCO loan
Housing and Urban Development Corporation (HUDCO), a Union government enterprise, has sanctioned a loan of ₹3,000 crore. The Railway Board has said that the project is under its appraisal and that any loan agreement with JICA, ADB, AIIB and KfW should be entered into by K-rail only after approval by the Centre. However, it has been made clear by the board that the project has been accorded the in-principle approval by competent authority in the Ministry of Railways for taking up pre-investment activities.
NITI Aayog, while giving its nod, has said it has examined clarifications sought from K-rail and that it supports the proposal to avail multilateral loan.
The steps for commencing acquisition of 1,383 hectares of land have failed to take off despite the in-principle approval given for the project and nod for the Detailed Project Report (DPR) and alignment by the State. The Revenue Department’s notification and administrative sanction for setting up Land Acquisition Cells is mandatory for acquiring land and the authorities are hoping that it will be issued once the new government assumes power in the State later this month.
