KOCHI: The Centre has given the green light to Silverline, the state’s Rs 64,000-cr semi high-speed rail project. Finance Minister Nirmala Sitharaman has sent a letter to Chief Minister Pinarayi Vijayan, asking the state government to expedite land acquisition after obtaining necessary clearances for the project.The letter, dated January 5, also directed the project implementing agency (PIA)/state government to engage with Japan International Cooperative Agency (JICA) to finalise the funding aspect.
“In the meanwhile, land acquisition and other clearances may be expedited by the PIA,” said the letter signed by Sitharaman.
The letter insists the state to complete ongoing projects worth Rs 43,200 crore before going ahead with Silverline. With Rs 1,10,055 crore set to be allocated for the overall development of the Railways under the National Rail Plan-2030, Kerala Rail Development Corporation Ltd (K-Rail) officials hope to start executing the Silverline project without delay.
“Silverline is already a part of the National Rail Plan-2030. With the budget insisting on implementing the plan in a time-bound manner, we feel the Silverline project too can be carried out without delay.
The FM’s letter on land acquisition and direction to initiate discussion with JICA are all positive developments as far as the project is concerned,” a K-Rail official told TNIE.“We are looking at a co-financing model. JICA has already evinced interest to provide $4.46 billion (Rs 33,000 crore) as loan.”
Fund: K-Rail in touch with international agencies
“We are also in talks with Asian Development Bank, Asian Infrastructure Investment Bank and KfW. We have requested $1 billion from ADB, $500 million from AIIB and $2.5 billion from remaining agencies,” said a K-Rail official.“The entire loan amount will be delivered in tranches. All the agencies are awaiting the approval of the Department of Economic Affairs to take a final decision and have demanded at least 80% of required land to be in possession with the implementing agency for funding,” said the official.
The international currency fluctuation is likely to impact the borrowing cost of the project. “Though we receive the loans at an interest of 0.2 to 1.5%, we will have to consider the dollar fluctuations up to 3-4%. So, the final interest rate will come to around 4-5%. Compared to commercial banks, it’s still a competitive rate,” the official said.
Finance Minister T M Thomas Isaac, while presenting the state budget speech in January, had clarified that the state government was moving ahead with land acquisition. “The land acquisition activities for the Silverline Semi High-Speed Rail Project will be started in 2021-22 after completing necessary environmental assessment and clearance,” he had said.
The 530.6-km-long corridor includes 185 hectares of railway land and 1,198 hectares of private land.
In the Rs 63,941-crore project, Rs 11,535cr has been earmarked for compensation. Of this, Rs 6,100 crore will be for acquiring private land, Rs 975 crore for taking over railway land and Rs 4,460 crore to pay compensation to structures that suffer damage. Another Rs 1,730 crore has been set aside for resettlement and rehabilitation.