The Hindu Business Line : Govt inks rail pact with Myanmar

The Minister of State for Railways, Mr R. Velu, and his Myanmar counterpart, Major General Aung Min, holding the memorandum document for the $56-million project for the development of Myanmar Railways in the Capital on Tuesday. — Ramesh Sharma

New Delhi , July 27

INDIA has extended a line of credit worth $56.36 million (Rs 265 crore) to beef up the railway infrastructure in Myanmar.

The funds would help improve passenger services on the Yangon-Mandalay trunk line and would involve upgradation of tracks, signalling and communication systems along with maintenance facilities on Myanmar Railways.

The Memorandum of Understanding (MoU) was signed on Tuesday by Ms Mitra Vasisht, Joint Secretary, South East Asia, Ministry of External Affairs, and Mr Uh. E. Kyi Thein, Myanmar's Ambasaador to India. Minister of State for Railways R. Velu and Myanmar's Minister for Rail Transportation, Maj. Gen. Aung Min were present on the occasion.

A separate agreement was signed between the EXIM Bank of India and Myanmar Foreign Trade Bank for the operations of the line of credit.

As per the MoU, Rail India Technical and Economic Services Limited (RITES) would execute the project for the supply of rolling stock, components, equipment and machinery to Myanmar.

RITES, which is the sole authorised export agency of Indian Railways, would supply ten 1350 Horsepower locomotives, 48 passenger coaches and capital spares having a total value of $28 million.

As per the agreement, the EXIM Bank will reimburse Indian exporters 100 per cent of contract value, upon shipment of equipment and goods and provision of services. The credit is available up to 10 years and will attract an interest rate of 0.5 per cent.

Indian Railways had earlier supplied 68 metre gauge coaches to Myanmar during the mid-60s, ten in-service metre gauge locomotives and high frequency railway communication systems.