Lucknow Metro a joint venture now, clearances to be faster. European Bank to invest Rs 33 billion for Lucknow Metro
Brussels/Lucknow: European Investment Bank will invest Rs 33 billion for the first metro line in Lucknow. President of the bank, Werner Hoyer confirmed the European Investment Bank’s commitment to support long term investment in India at the 13th India-EU summit held in Brussels yesterday.
The agreement to construct the Lucknow metro was signed yesterday by Vice President of the bank Jonathan Taylor and Manjeev Singh Puri, India’s Ambassdor to Belgium, Luxembourg and European Union in the presence of Prime Minister Narendra Modi.
Also, the Lucknow Metro Rail has become a joint venture between the centre and the Uttar Pradesh government after the two governments inked a memorandum of understanding on the project. Soon after signing of the MoU, the centre released Rs 140 crore as part of its equity in what would be now a 50:50 JV project.
Union urban development secretary Madhusudhan Prasad would now be the new chairman of Lucknow Metro Rail Corporation (LMRC), replacing chief secretary Alok Ranjan.
The LMRC board would be reconstituted with both the Central and the state government nominating five directors each apart from three functional directors, who are usually professional experts in the field. According to the LMRC, those nominated as directors by the Centre include additional secretary (MoUD) Durga Shankar Mishra, DMRC director (Finance) KK Sabbarwal, Railway Board executive director KK Aggarwal and joint secretary (MoUD) J Tripathi. The request to nominate one woman as director on the board, according to LMRC sources, was made by principal advisor to LMRC, E Sreedharan.
The Rs 140 crore released by the centre would have lapsed on March 31 if the JV was not signed. “Though there was never a funds crunch, the pact with the Centre would certainly help in expediting clearances with the foreign institutional lenders and agencies for the project,” said an official. He said the JV would be a tripartite agreement among the Lucknow Metro Rail Corporation (LMRC), the Central and the state government. Work on the Lucknow Metro Rail had commenced on October 28, 2014 when the Centre had given in-principle approval to the project.
Chief minister Akhilesh Yadav, who had given the go-ahead, then said that the state government would complete the project from its own resources even if the centre did not sign a joint venture agreement.
The estimated completion cost of the North-South corridor of the project is Rs 6,880 crore. A major chunk of this money (around Rs 3,550 crore) would be obtained by way of loan from the European Investment Bank and other foreign institutional lenders.
Service on the 8.5 kilometre-long priority section from Transport Nagar in Alambagh to Charbagh railway station is scheduled to commence early next year.