KOCHI: Multilateral funding agencies such as Japan International Cooperation Agency (JICA) have informally agreed to finance the SilverLine project at 0.25% interest rate while the Asian Development Bank (ADB) and Asian Infrastructure Investment Bank (AIIB) are ready to back the project by lending funds at 1-1.5% rates.
“We are talking to the funding agencies on an informal basis,” said V Ajithkumar, managing director of Kerala Railway Development Corporation (K-Rail), which is implementing the nearly Rs 64,000-crore project. JICA alone maybe ready to provide Rs 33,000 crore ($4.46 billion) as a loan for the project while the state government is negotiating with ADB ($1 billion) and AIIB ($500 million) for funding support.
These funding agencies are ready for a 40-year tenure loan with a moratorium on interest payments for the first five years,” Ajithkumar told TNIE, adding that the K-Rail is confident of repaying the entire loan amount within 20 years. “We are confident of the revenues generated from the project,” he said.
As far as equity participation is concerned, the K-Rail MD said 40% of the stake will be diluted in favour of the private equity funds or companies. There is also an option for an initial public offering (IPO) over time. “We have the Kannur and the Cochin airport model, where the shares were offloaded to private equities. We may also consider an IPO going forward,” he said.
K-Rail MD said SilverLine will be a multi-modal transport system, connecting metro rail and water metros at its stops. For instance, Kochi Metro Rail’s proposed Kakkanad station will be connected with SilverLine.
“SilverLine will be on the first floor of the Kakkanad metro rail station, while the second floor will be the Kochi metro stop. This way, we hope to provide seamless connectivity,” he said. Similarly, there will be connectivity between Kochi Water Metro’s Kakkanad stop to SilverLine.