Kerala moots KIIFB financing for Sabari rail project

by · The Hindu

Going back on its promise, the State government decided to go ahead with the Sabari rail project by financing the project from the Kerala Infrastructure Investment Fund Board (KIIFB). To make the project a reality, the State will also exert pressure on the Centre that the debt incurred by the KIIFB by financing the project should be fully exempted from the State’s borrowing limit.

The decision was taken at a meeting chaired by Chief Minister Pinarayi Vijayan here on Tuesday. Earlier, the State had decided to enter a tripartite agreement as suggested by the Union Railway Minister to implement the project. The agreement involving the State government, the Ministry of Railways, and the Reserve Bank of India (RBI) will ensure that the RBI will pay the share of Kerala to the Ministry of Railways if the State fails to pay its share of the project cost on time and deduct the amount from the Central share of assistance to Kerala for various schemes.

With the State rejecting the proposal for a tripartite agreement with the RBI, now the future of the project is likely to depend on a Supreme Court case, in which Kerala had challenged the Centre’s decisions curtailing its borrowings. Kerala had been demanding the Union government relax its borrowing restrictions to enable the State to borrow additional funds.

The meeting also allayed other apprehensions regarding the project. For instance, the State will request the Centre to implement the project in two phases. Terming that the project would be a better alternative for the Chengannur-Pamba rail route being considered by the Centre, the meeting suggested completing the first phase of the project in the Angamaly-Erumeli-Nilakkal stretch. Further, the meeting was of the view that a single line to Sabarimala is enough for the time being, and the proposal to double the line could be considered in the second phase.

Stressing that the project has big potential to boost the development of the State, the meeting suggested expanding the project up to Vizhinjam in the future. The 110-km Angamaly-Erumeli route was first announced in the Railway Budget 1997-98. Subsequently, land acquisition was completed in 8 km, while the 7-km stretch between Angamaly and Kalady was completed earlier. Further, notification was issued for the acquisition of the remaining 70 km. The State will have to bear half of the revised estimate of ₹3,810.69 crore now.

Published - December 17, 2024 09:00 pm IST