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China-based infra bank lends $356mn for Chennai Metro rail system
China and India are the top two shareholders in the 103-member bank, which was set up in 2016 at Beijing’s initiative, and seen as its answer to an international finance system dominated by western countries
The Beijing-based Asian Infrastructure Investment Bank (AIIB) has approved a $356.67mn loan to India for the expansion of the Chennai Metro rail system as part of efforts to expand green public rail transport options in the country.
The project involves the construction of an environment-friendly new corridor in Chennai’s metro network as part of Chennai Metro Rail Phase 2, the AIIB said in a statement on Thursday.
China and India are the top two shareholders in the 103-member bank, which was set up in 2016 at Beijing’s initiative, and seen as its answer to an international finance system dominated by western countries.
The Chennai project is the latest in the transport sector-related loans from the multilateral banking institute.
“It (the project) will span from Lighthouse in the east to Poonamalee Bypass in the west to ensure seamless multimodal transport across Chennai by providing integrated access to suburban rail, bus stations and the city’s main airport,” the AIIB statement said, adding that the project will be implemented by the Chennai Metro Rail Limited.
In addition, the project is expected to address traffic bottlenecks and reduce greenhouse gas emissions by increasing public urban transport options.
“This project is aligned with AIIB’s mandate to support high-quality and sustainable infrastructure. The improvement and integration of the transport sector in Chennai will further promote trade and economic growth,” DJ Pandian, AIIB vice president, investment operations, was quoted as saying in the statement.
The project also aims to ensure safer mode of public transport for women in Chennai.
“With this project, female passengers would have access to a safer and convenient mode of public transportation with knock-on effects such as increased opportunities to participate in school, work, and social activities,” the AIIB statement said.
The residential and commercial establishments along the new corridor will also benefit from enhanced accessibility and connectivity as well as increased economic opportunities, the statement said.
In addition to solar panels installed on the roofs of the elevated stations, the project will have dedicated spaces for bicycles and green vehicles, and signage to raise environmental awareness, the AIIB statement said, adding that the project also integrates climate change resilience features to reduce its vulnerability to climate-related events.
Since the founding of the bank, New Delhi has emerged as the top borrower with the AIIB having approved 28 projects in India with a total amount of $6.7 billion.
Energy and transport sectors in India have received the highest amount of AIIB’s financing.
Earlier this year, AIIB president, Jin Liqun said that the AIIB kept lending to India despite domestic pressure during the border dispute between India and China is proof that the institution is not simply a tool for China’s strategic interests.
“Bilateral conflicts between member states should not concern a multilateral institution,” he was quoted as saying by the Hong Kong-based South China Morning Post.
“We cannot keep talking about international standards and best practices in normal times, but change when encountering difficulties,” Jin said in his speech.
“Once trust is broken, it is very difficult to restore your reputation.”
