Sri Lanka, Japan ink USD 1.8 bn loan agreement for LRT system
Posted on March 11th, 2019
Courtesy Adaderana
The Government of Japan has agreed to grant loan assistance of USD 1,800 million for the Light Rail Transit System (LRT) project that is to be implemented this year as a solution for the traffic congestion on Colombo city and suburbs, the Ministry of Finance stated, issuing a press release.
Accordingly, the Japan International Cooperation Agency (JICA) will render its financial and technical support in this regard.
The Secretary to the Ministry of Finance Dr R.H.S. Samaratunga, the Japanese Ambassador to Sri Lanka Akira Sugiyama and Chief Representative of JICA, Mr. Fusato Tanaka today (11) signed the Loan Agreement and the Exchange of Notes pertaining to this project for the purpose of obtaining a loan of Japanese Yen 30,040 million as the first phase of loan facility.
According to the Ministry, the LRT System, proposed by the “Vision 2025: An Enhanced Country” Government’s Development Policy and the “2030 Western Region Megapolis Masterplan”, has designed to construct 17 km long elevated rail track including 16 stations to cover important and major intersections from Malabe to Colombo Fort.
The project will be completed in 2026 and establishes the connectivity between many administrative complexes, commercial hubs and densely populated residential areas of the city, the release further said.
Under the proposed light rail system, 25 trains will be deployed for the service and each unit will comprise of four air-conditioned passenger compartments to accommodate 800 passengers, the Finance Ministry says. Based on the demand during the peak hours, trains will be operated with a minimum three-minute headway to ensure an efficient and comfortable ride for the passengers.
As per the feasibility studies conducted by the Japan International Cooperation Agency (JICA) and the Ministry of Megapolis and Western Region Development, a total estimated cost of the project is Japanese Yen 246, 641 million, the press release stated.
Out of the total estimated cost, JICA will provide JPY 200,415 million (approx. USD 1,800 million) as a concessionary loan which is the highest ever foreign loan investment made for an infrastructure development project in Sri Lanka, it further read.
March 13th, 2019 at 1:26 pm
This project is way too expensive. Looks like all politicos shedding their differences for their personal benefits. How can one kilometer cost dollars one hundred million. Also the whole thing is not financed by the Japanese. From what we read about 25 percent is financed by GOSL. That should be the actual cost to be met by the dollar bonds at 8 percent. This whole thing should be cancelled and an elevated highway should be constructed using local contractors without the Japanese loan.
March 13th, 2019 at 1:33 pm
If we go on like this we will have to sell the whole country to pay back the loans. We may become worse than Zimbabwe very soon.