Financial Daily from THE HINDU group of publications
Wednesday, Sep 18, 2002
Talks on for $300-m ADB loan for Railways
NEW DELHI, Sept. 17
THE Government and the Asian Development Bank (ADB) are likely to conclude negotiations on the proposed $300 million loan for the Indian Railways by the end of November this year.
An appraisal mission of the ADB is currently in India holding talks with the Railway Ministry on the proposed loan which will be utilised for completion of last mile railway projects and other projects for strengthening the Golden Quadrilateral.
However, unlike in the past, the conditionalities attached to the ADB loan are not perceived to be too stringent by the Railway Ministry.
Loan negotiations with the ADB, a couple of years ago, could not be completed as the Railway Board rejected some of the conditionalities including downsizing of railway staff.
According to senior Government officials, the proposal for the $300 million loan is likely to be forwarded to the ADB board for clearance by the end of November this year. The Railways have already identified close to half a dozen projects and more sub-projects would be added to the list once the loan is approved, said officials.
The ADB loan would form part of the proposed $3,100 million investment being planned by the Railways for removing capacity bottlenecks in critical sections of the railway network.
Besides strengthening of the Golden Quadrilateral which would enable the Railways to run more long-distance mail and express trains and freight trains at a higher speed, investments will also be made for strengthening rail connectivity to ports and completion of all viable projects in the sanctioned plan within a stipulated time.
The $3,100 investment (Rs 15,000 crore) will be in addition to the $3,500 million (Rs 17,000 crore) earmarked for safety related works, the Railway Minister, Mr Nitish Kumar, said here at the International Conference on Rail Financing.
According to him, the Railways plan to add another 6,000 km to their existing network during the Tenth Plan which is under finalisation.
Besides investment from the Central Government through budgetary support, the financing for these projects will be through innovative schemes such as public-private partnership with State Governments, commercial exploitation of railway property and so on.
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