The Mumbai Metropolitan Regional Development Authority is planning to approach the Japan Bank for International Cooperation for loan for the Rs 10,000-crore (Rs 100 billion) second line of the metro rail even as the World Bank resumed aid to the first line of the metro rail project. Work for the second line is expected to commence in 2008.
MMRDA metropolitan Commissioner T Chandrashekhar said, "We have approached the JBIC for the second line of the metro rail which is expected to cost Rs 10,000-12,000 crore (Rs 100-120 billion).
One round of the preliminary discussions on the subject is over and a delegation led by the state chief Minister Vilasrao Deshmukh will be visiting Japan in June to discuss the deal further. We have decided not to approach the World Bank for any of our projects anymore."
He added that while the World Bank had been giving loans to the MMRDA at 9 -11 per cent interest rates, JBIC had offered loans between at rates between 1 and 1.5 per cent.
He, however, did not clarify whether the loan would be a yen or a dollar loan. "While the World Bank took over 10 years to sanction the present loan, JBIC has promised to do it in less than a year," he added.
The World Bank had suspended aid to MMRDA for more than six months over the issue of resettlement and rehabilitation of projects-affected persons, contending that norms laid down by the agency were not being met. MMRDA on the other hand insisted that the bank's norms were impractical.
Chandrashekhar said, "The World Bank kept changing its R&R norms even after we had signed the deal. While we have to follow the norms laid down by the Slum Act enacted by our state government, they insisted that we follow the norms laid down by them in Washington which were not practical in Indian conditions."
The second line of the metro rail will be between Colaba in South Mumbai and Charkop in the western suburbs.
The first line of the Metro rail between Versova and Vikhroli is being built by Reliance Energy of Anil Dhirubhai Ambani Group at a cost of Rs 6,500 crore (Rs 65 billion).
