In a first, major global funding agencies like Japan International Cooperation Agency (JICA), World Bank (WB) and Asian Development Bank (ADB) are keen on financing the upcoming infrastructure projects in Mumbai and have conveyed it to the Maharashtra government.
As part of its plan to rebuild infrastructure in the financial capital, the state has taken up mega projects such as the 118-km-long Metro network, Mumbai trans-harbour link (MTHL) connecting the city with the hinterland, coastal road, Virar-Alibaug multi-modal corridor and the Mumbai Urban Transport Project to upgrade and expand the suburban rail network in Thane and Raigad districts.
The three funding agencies have shown interest in the projects being carried out by the Mumbai Metropolitan Region Development Authority (MMRDA) to build the 118-km Metro network using the master plan. JICA has already approved a loan of Rs 13,235 crore, around 57% of the total project cost of Rs 23,136 crore, for Metro-3 (Colaba-Bandra-SEEPZ). It is also in talks with the state to fund the Rs 11,000-crore MTHL, which has got the environmental clearance. The World Bank is interested in funding the upcoming phases of the MUTP. It has already part-funded the MUTP-1 and 2.
The state government and MMRDA officials have termed the development “remarkable”. This is in complete contrast to the situation a few years ago, when funding agencies had to be approached for infrastructure projects. The change in perception towards city projects can be attributed to the global economic slowdown and the prospective financial growth of Mumbai, according to officials.
MMRDA commissioner UPS Madan said, “The funds available with the agencies are unutilised because of economic recession, so they are looking at governments. The track record of infrastructure execution and financial stability of Mumbai have attracted them towards the new projects.”
MMRDA officials are now studying the proposals by the agencies to select the best offer. The officials said they will study the terms and conditions in the loan proposals, along with the loan amount and interest rates. “We are looking at all aspects of possible funding from these agencies. We will select the agency whose funding model we are comfortable with,” Madan said.
Experts in the field are not surprised by the current trend. Vishwas Udgirkar, infrastructure expert and senior director, Deloitte, said, “The agencies have targets to achieve loan disbursements and sanctions. They also have a certain criteria for the type of projects to focus on and the geography they should go for. India, being a developing nation and stable economy, is on their priority list.”
A Chinese company -- China Communications Construction Company Limited (CCCC) – too has expressed its desire to fund and construct the MTHL, during Fadnavis’ China visit in June this year.
WHY THE CHANGE
This is in complete contrast to the situation a few years ago, when funding agencies had to be approached for infrastructure projects
The change in perception towards city projects can be attributed to the global economic slowdown and the prospective financial growth of Mumbai, according to officials.