JAPANESE AGENCY TO FUND KOCHI METRO

The Japan International Cooperation Agency (JICA), which partially funded Delhi Metro Rail Corporations’s Phase-I and II projects will be the main source of funding for the Kochi Metro, project director Tom Jose told The Japanese agency will provide 51 per cent of the total estimated cost of Rs 4,427 crore at an interest of 1.5 per cent. Tom pointed out that no other agency will provide aid for such small interest rate from within or outside the country.

                                          JAPANESE AGENCY TO FUND

                                        KOCHI METRO


Even the World Bank is charging interest rates which are over five per cent. The loan is for a period of 30 years. It will also have a moratorium period of 10 years. This means Kochi Metro will have to start repaying the loan only after a period of 10 years.When the project is implemented in the Chennai Metro model, centre and state governments will bear15 per cent each of the total cost. Eleven percent of the remaining amount would come from other loans, 5 per cent will be the cost of the land acquired and another 3 per cent would be earmarked as tax exemptions.The JICA aid would mean that the project can be completed without the co-operation of the private sector.If private participation was allowed the private companies would have to be given the ownership of land worth crores of rupees near the metro rail, he said.
It was the success of the Delhi metro that promted the company to show interest in Kochi's pet project, Tom said. The discussions held between the representatives of the company were very constructive, he said. The company came forward to provide financial help for the first, second and third phases of the Delhi metro. Apart from this they are providing aid for the Chennai and Bangalore metros.With the success of the Delhi metro, the agency has become sure that India has achieved the expertise in the construction of metro rails. Tom said that the company's decision to take over the overseeing of the construction of the project will be highly beneficial for Kerala. The project will be a success said Tom quoting statistical details. After the commissioning of the project, during the peak hours there will be 13000-15000 passengers in one direction. If that happens up to 8.5 per cent of loan can be repaid at the beginning itself. If it comes over four per cent in the initial stages, it is generally considered as a successful project. So the possibility of success is very high for the project, he said.

                                                                                           Prof. John Kurakar