THIRUVANANTHAPURAM: Uncertainty continues looming large over the ambitious light metro projects proposed for Kozhikode and Thiruvananthapuram with the government failing to finalise a suitable financial model.
The state government submitted detailed project reports and comprehensive mobility plan to the ministry of urban development (MoUD), but the Centre will not grant the clearance unless the government provide a report on the financial model.
P. I. Sheik Pareeth, managing director of Kerala Rapid Transit Corporation (KRTC) – the special purpose vehicle formed to execute the projects – told DC that the state government, especially finance department, should take the call.
The state is expecting 20 percent viability gap funding from the Centre and planning to raise 60 percent funds through the foreign loan. Light metro projects together are expected to cost around Rs 6,728 crore.
“Delhi Metro Rail Corporation (DMRC) principal advisor E. Sreedharan has recommended JICA loan. However, there are certain conditions regarding procurements if we avail it. Another option is Agence Française de Développement (AFD) – the French overseas development bank – which is funding Kochi Metro,” said Mr Pareeth.
He said both these banks were ready to advance the projects. “The Centre has written to us seeking clarity on the financial model and now the government has to finalise the model and inform the Centre,” said Mr Pareeth.
He said the interest rate for JICA loan is 0.3 percent, which is very less, and the repayment period is 40 years. “But for AFD, the government would have to repay the loan within 20 years,” he said.
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