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Business EconomyPosted at: Oct 21 2016 8:30PM


Govt signs $650mn agreement with WB for Eastern Dedicated Freight Corridor

New Delhi, Oct 21 (UNI) The Government of India and the World Bank today signed a 650 million dollar agreement towards the third loan for the Eastern Dedicated Freight Corridor (a freight-only rail line) that will help faster and more efficient movement of raw materials and finished goods between the north and eastern parts of India. The project was approved by the World Bank Board on June 30, 2015.
The loan and guarantee agreement for the Eastern Dedicated Freight Corridor Project was signed by Raj Kumar, Joint Secretary, Department of Economic Affairs, Ministry of Finance, on behalf of the Government of India; M.K. Mittal, Director, Finance, Dedicated Freight Corridor Corporation(DFCCIL) and Hisham Abdo, Operations Manager and Acting Country Director, World Bank India, on behalf of the World Bank.
The Eastern Corridor is 1,840 km long and extends from Ludhiana to Kolkata. The World Bank is supporting the Eastern Dedicated Freight Corridor (EDFC) as a series of projects in which the three sections with a total route length of 1,193 km will be delivered sequentially, but with considerable overlap in their construction schedules.
The loan, from the International Bank for Reconstruction and Development (IBRD), has a 7-year grace period, and a maturity of 22 years.
EDFC 3, approved by the Board on June 30, 2016, will build the 401 km Ludhiana–Khurja section which goes through Punjab, Haryana and Uttar Pradesh. The project will help increase the capacity of these freight-only lines by raising the axle-load limit from 22.9 to 25 ton axle-load (upgradable to 32.5 ton axle loads) and enable speeds of up to 100 km/hr. The DFC lines are being built to carry bulk freight trains of 6,000 to 12,000 gross tons. The project is also developing the institutional capacity of the DFCCIL to build and maintain the DFC infrastructure network.
“The objective of the EDFC project is to augment railway freight carrying capacity along the Railway Corridor between Ludhiana and Kolkata. The project will benefit industries of Northern and Eastern India, which rely on railway network for transportation of material inputs and exports that would accelerate creation of jobs in the northern and eastern regions of the country,” said Raj Kumar, Joint Secretary, Department of Economic Affairs, Ministry of Finance.
The first loan of 975 million dollar for the 343 km Khurja-Kanpur section in the EDFC program was approved by the World Bank Board in May 2011 and is already under implementation. The project has already awarded contracts worth Rs 5500 crore. The second loan of 1.1 billion dollar for the 402 km Kanpur-Mughalsarai section was approved by the World Bank Board in April 2014 and is in the implementation phase. The major contracts for civil works and systems has been awarded with a total value of Rs, 6300 crore.
“Implementing the Dedicated Freight Corridor program will provide India the opportunity to create one of the world’s largest freight operations. The corridor, which will pass through states like Uttar Pradesh, will benefit from the new rail infrastructure, bringing jobs and much-needed development to some of India’s poorest regions,” said Hisham Abdo, Operations Manager and Acting Country Director, World Bank India. “Moving freight from road to rail will reduce the carbon footprint of freight,” he added.
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