The German Federal Ministry for Economic Cooperation and Development (BMZ) - KfW - has approved two loans totalling €545 million to the Indian Ministry of Finance for the funding of Metro Line 4 (Wadala to Kasarvadavli) and Line 4 A (Kasarvadavli--Gaikmukh). An agreement was signed between KfW and the MMRDA, Government of Maharashtra, at the Sahyadari guesthouse on Friday.
Chief Minister Uddhav Thackeray was in attendance through digital conference. With the signing of the loan agreement for both metro lines, MMRDA now aims to complete them on time and increase its investment partnership with KfW.
According to the MMRDA, the credit package for Metro Line 4 and 4A includes a development loan of €345 million and a promotional loan of €200 million. €255million of the €345 million will be spent on rolling stock and an integrated ticketing system and the remainder on a multi-modal integration system. After negotiations, the KfW has imposed 0.29 per cent and 0.07 per cent rates of interest on the €345 million loan, while for the promotional loan of €200 million, it is 0.82 per cent.
The loan amount of €545 million approved by the KfW is the highest-ever given to India, at the lowest rate of interest offered by any financial institution so far. Further, the lending for metro expansion has eliminated scepticism about lack of funds to carry out various projects initiated and planned in the MMR, the MMRDA said in its press note.
MMRDA Commissioner R A Rajeev said, "I welcome the loan approval by KfW for Metro lines 4 and 4A. The MMRDA has built a reputation over the years by successfully implementing various infrastructure projects and simultaneously meeting all financial commitments to various lending institutions, even during pandemic times.
"The MMRDA is also working for mitigation of climate change by executing metro projects across the Mumbai Metropolitan Region. Once Metro lines 4 and 4A begin operations, it will help emission of up to 121,000 tonnes of greenhouse gases every year, ensuring reduction in air pollution."
The approved funds will cover the system components for the two metro lines, as well as footpaths and cycle routes surrounding the stations to improve integration within the transport system. These lines will bring north-south connectivity, linking Mumbai to Thane.