China Exim Bank signs $ 200 m loan to put Matara-Beliatta on track

Monday, 4 March 2013 00:00 - - {{hitsCtrl.values.hits}}

The Exim Bank of China has signed the relevant Loan Agreement with the Government of Sri Lanka indicating its agreement to provide US$ 200 million under Preferential Buyer’s Credit facility to finance the Matara-Beliatta Section of the Matara-Kataragama Railway Extension Project.

This is following the Chinese Government on request from the Government of Sri Lanka agreeing to provide a loan of US$ 278.2 million through Export-Import (Exim) Bank of China on concessional terms to finance Phase I of the Matara-Kataragama Railway Extension Project.

The Finance Ministry said out of the total loan amount, US$ 200 million will be provided under Preferential Buyer’s Credit facility and the balance US$ 78.2 million will be provided under Chinese Government concessional loan facility. These loan facilities will be provided at an annual interest rate of 2% with a repayment period of 20 years including a five-year grace period.

The Finance Ministry said the extension of the new railway line from Matara to Kataragama is a flagship project in the development plan of the Government.

The project will facilitate an efficient and economic transport service by connecting cities from Colombo to Kataragama.

The demand for transport between the Southern Province and other provinces of the country will highly increase due to developments in the southern region and operations of the Hambantota Port and Mattala Airport.

The project is expected to meet this demand for transport while providing an environmentally friendly mode of transport. In addition, the new railway line will also benefit commuters and transportation of goods from remote areas of the Southern Province of Sri Lanka.

This project is planned to be implemented in three phases. Under Phase I, construction of railway line from Matara to Beliatta will be carried out. Phase II and Phase III include the construction of railway lines from Beliatta to Hambantota and Hambantota to Kataragama respectively.

Phase I of the project consists of construction of 26.75km long single line broad gauge rail track from Matara to Beliatta including construction of structures such as culverts, bridges over rivers, viaducts required over the Nilwala river flood plain, level crossings, underpass boxes, road diversion, four railway stations and functional requirements including construction of railway quarters for staff, earth embankments and ground treatment, etc.