Mumbai Metro One Pvt Ltd, a joint venture between Anil Ambani-led RInfra and the state government's infrastructure arm, the Mumbai Metropolitan Regional Development Authority, has achieved financial closure for the Rs 2,356-crore (Rs 23.56 billion) Varsova-Andheri-Ghatkopar corridor.

A consortium of six banks led by IDBI will finance the project to the tune of Rs 1,194 crore (Rs 11.94 billion), Rs 512 crore (Rs 5.12 billion) will be raised through equity while Rs 650 crore (Rs 6.5 billion) will come from the MMRDA as capital subsidy.

The closure is unique in many ways as nearly Rs 200 crore (Rs 2 billion) have been spent on the project before the financial closure.

"The only recourse to the lenders is the revenue generated by the project. They will have no charge on the assets of the project," MMOPL Director and Project Head KP Maheshwari said while speaking with Business Standard.

The 11-km metro corridor will be completed by September 2010 as against the deadline of March 2012 laid down in the concession agreement with the MMRDA, according to Maheshwari.

The cost of borrowing for the rupee component, which constitutes about 75 per cent of the total debt, will be 12.25 per cent, while the foreign currency interest rate is 3.5 per cent above LIBOR.

The repayment has also been structured in a manner that gradually increases over a period of time, in sync with the increasing traffic revenue generated by the project.