India, Japan sign loan agreements on rail projects

Government of India and the Japan International Cooperation Agency (JICA) have entered into two loan agreements related to construction of the Mumbai-Ahmedabad high-speed rail project and the Kolkata East-West metro project

September 28, 2018

The deal will forward US$787 million to the Mumbai-Ahmedabad high-speed rail project, and around US$228 million for the Kolkata East-West metro project

The deal comes weeks after Indian Railways and JICA signed a deal related to capacity building for railway safety, covering track maintenance and rolling stock

Japan has been one of the biggest stakeholders in India’s transportation sector through both funding as well as engineering and development assistance

The Ministry of Railways has signed preliminary agreements with China, France, Spain, South Korea, Japan, the UK, Russia and Germany to drive efficiency

Government of India and the Japan International Cooperation Agency (JICA) on September 28 entered into two loan agreements related to construction of the Mumbai-Ahmedabad high-speed rail project and the Kolkata East-West metro project. The deals were signed by the Department of Economic Affairs (DEA), Ministry of Finance and JICA. The deal will forward US$787 million to the Mumbai Ahmedabad high-speed rail project, and around US$228 million for the Kolkata East-West metro project. The funding comes amid strengthening of ties on the back growing bilateral trade as well as governmental exchanges.

The latest deal comes weeks after Indian Railways and JICA signed a deal related to capacity building for railway safety. Japan has been one of the biggest stakeholders in India’s infrastructure sector through both funding as well as engineering and development assistance with a focus on transportation projects. The projects come as part of an effort of the Government to drive economic growth through improved infrastructure. India has also planned industrial clusters along transportation corridors. Herein, high speed rail and metro rail have come up as ready solutions for the traffic woes in India’s big urban centres.

India and Japan, a global leader in railway engineering, have signed several agreements encompassing high-speed railways, railway safety, maintenance and engineering, among others, while incorporating ‘Make in India’. The Ministry of Railways has signed preliminary agreements with China, France, Spain, South Korea, Japan, the UK, Russia and Germany for cooperation in railways. Indian Railways has also received foreign direct investment (FDI) inflow of US$390 million over April 2014 to December 2017. Indian Railways, the third largest in the world, carry 23 million travellers and 3 million tonnes of freight daily.

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