World Bank, AIIB sanctions Rs 6,325 crore loan for Pune metro project
The Dollar Business Bureau
The World Bank and the Asian Infrastructure Investments Bank (AIIB) have sanctioned a loan of Rs.6,325.50 crore for the construction of stagnant Pune metro rail project.
The loan will be taken by the Special Purpose Vehicle (SPV) for Pune metro, while the central government will provide sovereign guarantee for the transaction. The announced loan would be co-financed by the Word Bank and the AIIB. The amount will be split in two-three smaller tranches.
Following announcements from the World Bank and China-led AIIB Bank, the government has given its approval for loan assistance of Rs.6,325.50 crore for the first phase of Pune metro rail project.
The repayment of the loan would be borne by the SPV. The repayment will be done with the amount generated from ticket fares, development charges from structures, and extra cess collected by the civic body.
Pune Municipal Commissioner Kunal Kumar said the loan would comprise of 50% of the total product cost. The remaining expanses will be borne by the Central government, State government and PMC-PCMC.
The central government would contribute Rs.2,118 crore; the state government Rs. 2,430.40 crore; and PMC and PMC would together contribute Rs.1,278.40 crore.
“The process for completing the formalities for the loan would be completed in next few months. It also includes final approval of the union government,” Kumar said.
The construction of this project will resume once the central government gives its approval and the fund is allocated.