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Japanese funding agency clears loan for Mumbai Trans Harbour Link
After visiting Japan in September last year, chief minister Devendra Fadnavis said the Japan International Co-operation Agency agreed to fund the project
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The decks have been cleared for the official launch of the long-pending sea bridge, the Mumbai Trans Harbour Link (MTHL), by Prime Minister Narendra Modi later this month with the funding agency Japan International Co-operation Agency (JICA) finally agreeing to grant loan for the project.
The decision from the funding agency came after the central government agreed to stand as a guarantor for the loan. The matter was pending with the Japanese firm since last year as it was unwilling to give direct loans to the state government or the Mumbai Metropolitan Region Development Authority (MMRDA).
UPS Madan, MMRDA commissioner, confirmed that the JICA has agreed to grant loan for the MTHL project. “The central government has decided to be the guarantor for the loan, after which JICA gave its final approval to fund the project two days back,” Madan told HT.
After visiting Japan in September last year, chief minister Devendra Fadnavis said the JICA has agreed to fund the project. The agency had assured loans worth Rs15,000 crore, which amounts to 85% of the Rs17,750 crore project. Following this, JICA conducted an environment impact assessment and social impact assessment by appointing a consultant, but despite favourable reports there was no progress in the matter.
Sources said that the JICA appraisal committee was not willing to grant loan to MMRDA, an undertaking of the state or to the state government. Instead, the firm was insisting to channelise it through central government. The issue was sorted out in a high-level meet held in New Delhi on September 30.
The finance ministry agreed to become a guarantor for the project, but MMRDA will have to pay 1.2 per cent of the total loan for the project, that comes to around Rs200 crore as charges, the sources added.
Madan said the department of economic affairs (DEA), an agency of the finance ministry, will give the final approval to the proposal. “We are expecting to sign a formal agreement with JICA in the next one month,” he added.
The 22-km-long MTHL project will connect Sewri in Mumbai with Nhava in Navi Mumbai where Mumbai’s second international airport is coming up. The six-lane bridge will have a 16.5km section over the sea and a 5.5km portion on land that will pass through lands owned by the two ports.
What next
The fresh development will now help MMRDA to move for second stage of the bidding process.
The agency will shortlist the bidders and can ask them to submit Request for Proposal (RFP).
MMRDA had invited Request for Qualification (RFQ) in May this year and had received total 39 bids for construction that has been divided in to three parts.
However, the project cannot be completed before 2021 even though the Chief Minister has been repeatedly declaring 2019 end as deadline for its completion.
RFQ clearly says that the construction period will be four and half years that comes to mid-2021.
Global firms such as Daewoo, OHL and Indian firms such as TATA, NCC, Gammon, Afcons, Reliance Infrastructure and J. Kumar are some of the companies that have shown interest in the project.
