Friday, October 28, 2011

Another Indian Rail Freight Project Finds Finance

Development of the Subcontinents Infrastructure Vital to Growth
Shipping News Feature

INDIA – Following our story last month that the Asian Development Bank were to lend Indian Railways up to half a billion dollars for rail infrastructure development it seems everybody now wants to hand over cash to aid the country’s rail freight links. The World Bank has now agreed to lend $975 million for the development of the much lauded Eastern Dedicated Freight Corridor.

As we pointed out in the last piece often nothing seems to happen after these grand pronouncements, indeed at the time of writing neither the World Bank website nor that of the Dedicated Freight Corridor Corporation of India (DFCCIL) have any statement confirming the deal, it must be said however that infrastructure improvement in the region is long overdue and the loan is confirmed by the other signatories, namely the Department of Economic Affairs.

According to the statement the loan, from the International Bank for Reconstruction and Development (IBRD), has a maturity period of 22 years including a 7-year grace period and the money is to finance development of an 1100 kilometre stretch of track as part of the planned route from Ludhiana in Punjab before passing through the states of Haryana, Uttar Pradesh, Bihar and terminate at Dankuni in West Bengal. Roberto Zagha, the World Bank’s Country Director in India is quoted as saying:

“The dedicated freight corridor programme will provide India the opportunity to create one of the world’s largest freight operations, adopting proven international technologies and approaches which can progressively be extended to other important freight routes throughout the network.”