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The Kochi Metro project, which is currently estimated to cost over Rs 5,500 crore, is now closer to getting a French soft loan of up to Rs 1,500 crore.
Even as a delegation of the French financing agency AFD (Agence Francaise de Developpement) made a final appraisal of the project for a loan of up to Rs 1,500 crore on Tuesday, doors were open for a Rs 1,200 bank loan. Kochi Metro Rail Ltd functionaries indicated that a major bank in India had offered a soft loan of up to Rs 1,200 crore. The project needs to get around Rs 2,170 crore as loan.
The AFD team is reported to have been satisfied with the project by and large, though it had sought certain clarifications mainly related to environmental clearance and conveniences at metro stations as well as on board trains.
If everything goes well, the AFD board will give its green signal to the funding in late November and the credit line will be open in December. The quantum of the credit, which has to be repaid in 20 years at an interest rate of 2 per cent in 20 years, will depend on the value of the rupee against the euro.
The metro project equity is held equally by the State and Centre. A loan offer from the Japan International Cooperation Agency is also being considered by KMRL. Now that the foreign and domestic financial sources have almost been identified, KMRL will take the final call on the funding in December, officials said.
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