Japan’s largest bank Tokyo-Mitsubishi UFJ will fund a $ 1 billion project to build the third phase of the central expressway and an elevated road connecting the Kelaniya Bridge to Rajagiriya.
Cabinet approval was given on Wednesday for the Government to borrow $ 1 billion at concessionary rates from the bank on a Cabinet paper submitted by Prime Minister Ranil Wickremesinghe in his capacity as the Minister of National Policies and Economic Affairs.
The loan, which has a repayment period of 15 years with a six-year grace period, will be used to construct the central expressway and an elevated road from Kelani Bridge to Rajagiriya, which have been identified as a priority project by the Government.
The Cabinet Committee on Economic Management, at its meeting on 17 May, approved the construction of the third phase of the central expressway from Pothuhera to Galagedera and the elevated road and the decision was subsequently ratified by Cabinet on 24 May. The project will now be given funds under the latest Cabinet decision.
However, the Government will conduct further negotiations with the bank on terms and conditions of the proposed credit facility, the Cabinet paper seen by Daily FT said.
Cabinet also approved a separate proposal by the Prime Minister to obtain a technical assistance loan from the Asian Development Bank (ADB) to prepare feasibility studies and other documents for transport projects proposed by the Government.
The loan will be used to conduct feasibility studies, detailed designs and procurement document preparation and implementation of a range of transport projects. The proposal made by Prime Minister Ranil Wickremesinghe, in his capacity as the Minister of National Policies and Economic Affairs, to hold discussions with the ADB to obtain a technical assistance loan of $ 24.42 million for the above project, was also approved by the Cabinet of Ministers. (UJ)