An agreement to provide Indian assistance of $ 318 million credit line for the development of the railway sector was signed at the Ministry of Finance yesterday.
Indian Prime Minister Narendra Modi during his first visit to Sri Lanka in March 2015 had declared a fresh Line of Credit (LOC) of $ 318 million for the development of railway sector in Sri Lanka.
The Government of India has already provided four Lines of Credit for the development of railway sector in Sri Lanka through its EXIM bank amounting to approximately $ 966 million.
These credit facilities have been utilised to improve the southern and northern railway lines and for the procurement of rolling stocks for the Sri Lanka Railways. The signing of the agreement pertaining to the loan took place yesterday at the Ministry of Finance and Mass Media.
The loan agreement was signed by Ministry of Finance and Mass Media Secretary Dr. R.H.S. Samaratunga and Export-Import Bank of India Managing Director David Rasquinha in the presence of Ministry of Transport and Civil Aviation Secretary Nihal Somaweera, Deputy High Commissioner of India Arindam Bagchi, Department of External Resources Director General Priyantha Rathnayake and distinguished officials of both Governments. Sri Lanka Railways under the supervision of the Ministry of Transport and Civil Aviation will implement the projects.
The Ministry of Transport and Civil Aviation has identified that the improving passenger transportation facilities is an urgent requirement to attract more passengers towards railway transportation which is efficient and cost effective. Further, reducing congestions in railways by improving rail tracks and signalling systems is also a key requirement to promote passenger and freight transportation.
The Government of India has been the major development partner of Sri Lanka in the South Asian region for over 40 years, since 1973. During the last few years Indian Foreign Direct Investment in Sri Lanka has expanded exponentially. Presently Indian development assistance in Sri Lanka mainly focuses on improvement of economic infrastructural facilities, livelihood development, education, healthcare, capacity building and economic renewal.