March 31, 2016
Mr. Takema SAKAMOTO, Chief Representative, JICA India Office with Mr. S Selvakumar, Joint Secretary, DEA, Ministry of Finance, Government of India in New Delhi
New Delhi, March 31, 2016: Japan International Cooperation Agency (JICA) today signed an agreement with the Government of India to provide 103,664 million Japanese Yen (approx. 6,170 crores) Official Development Assistance (ODA) loan for the Dedicated Freight Corridor Project Phase 1 (III): Tranche 3. The ODA loan's conditions are very concessional, i.e. 0.1% of interest rate and 40 years of repayment period (including 10 years of grace period).
JICA, Ministry of Railways and Dedicated Freight Corridor Corporation of India (DFCCIL) confirmed that as per the latest disbursement projection of the project, the amount of funds currently available under the Phase 1 (II): Tranche 2 loan is likely to be exhausted in the coming fiscal year, 2016, thus further mobilization of fund is essential for smooth operation of this significantly important national project.
The main feature of the project is the construction of new double track electrified railway lines for the sole use of high speed freight cargo trains as the backbone of Delhi-Mumbai Industrial Corridor (DMIC) development plan.
The agreement was signed by Takema SAKAMOTO, Chief Representative, JICA India Office with Mr. S Selvakumar, Joint Secretary, DEA, Ministry of Finance, Government of India in New Delhi.
Speaking on the occasion, Takema SAKAMOTO, Chief Representative, JICA India Office said, "JICA is committed towards the development of infrastructure in India. This loan will support to cope with the huge and rapid increase of freight transport demand in India by constructing new dedicated freight railway system. It will help to promote comprehensive regional economic development along the freight corridor, DMIC, through improvement and modernization of inter-modal logistic system handling considerable freight traffic".
The executing agencies for the project are the Ministry of Railways (MOR) and Dedicated Freight Corridor Corporation of India Limited (DFCCIL). DFFCIL will be responsible exclusively for planning, development and management of the whole DFC railway line, with full administrative, budgetary and technical support by MOR. MOR will be responsible for the procurement of rolling stocks (locomotives), construction of locomotive depot, train operation and maintenance of the rolling stocks.
The western Dedicated Freight Corridor being developed by the project runs between Delhi and Mumbai and covers the areas where significant commercial and industrial development is seen, namely Maharashtra and Gujarat, which have several deep sea ports. The project also covers the Delhi Metropolitan area which is one of the largest consumption areas in North India.
In this project phase1, a new 950km freight line (Rewari to Vadodara) connecting the major cities in Gujarat, Rajasthan, and Haryana states will be constructed, and high-quality freight locomotives with large-capacity and high-speed will be introduced. This project will become the backbone of DMIC initiative, being developed as the country's one of the largest integrated industrial areas between Delhi and Mumbai, aimed at promoting direct investment by Indian and foreign companies including Japanese companies.
The task of rapid expansion of railway transport capacity in India has become the most important and urgent issue, because the existing railway transport system is fragile to meet the increased demand for passenger and freight traffic resulting from recent rapid economic growth of India.
Established, by a specific law, as an independent administrative institution under the Government of Japan, the Japan International Cooperation Agency (JICA) aims to contribute to the promotion of international cooperation, as a sole Japanese governmental agency in charge of ODA implementation. JICA works as a bridge between Japan and emerging countries, and provides assistance in forms of loan, grant and technical cooperation so that the emerging countries can strengthen their capabilities.
JICA India Office Web: http://www.jica.go.jp/india/english/
JICA India Brochure: http://www.jica.go.jp/india/english/office/others/brochures.html