New Delhi, Oct 27: The World Bank has offered India a $975 million loan for developing a freight corridor that will help improve the movement of raw materials and finished goods between the northern and eastern parts of the country, an official statement said Thursday.
The loan is for a dedicated rail line for freight called Eastern Dedicated Freight Corridor-I developed by Dedicated Freight Corridor Corporation of India Ltd.
This is part of India’s first dedicated freight corridor initiative – being built on two main routes – the Western and the Eastern Corridors.
These corridors will help India make a quantum leap in increasing the railways’ transportation capacity by building high-capacity, higher-speed dedicated freight corridors along the golden quadrilateral – the four rail routes that connect Delhi, Mumbai, Chennai, and Kolkata, the finance ministry said in a statement.
Currently, these routes account for just 16 percent of the railway network’s length, but carry more than 50 percent of India’s total rail freight.
The Department of Economic Affairs and Dedicated Freight Corridor Corporation of India Ltd has singed an agreement with the World Bank for the project.
‘Dedicated freight corridors will not only meet this growing freight demand, but also decongest the already saturated rail network and promote the shifting of freight transport from road to more efficient rail transport,’ said Venu Rajamony, Joint Secretary, Department of Economic Affairs.
He said freight traffic in India was projected to grow over 7 percent annually and the development of the dedicated corridors would help in the easier movement of goods.
The eastern dedicated freight corridor project will ease congestion choking the railway system and reduce travel-time for passenger trains on the arterial Ludhiana-Delhi-Mughal Sarai railway route.
The World Bank financing for the project will cover a route length of 1,130 km out of a total corridor length of 1,839 km. The project is to be developed in three phases.
‘The dedicated freight corridor programme will provide India the opportunity to create one of the world’s largest freight operations, adopting proven international technologies and approaches which can progressively be extended to other important freight routes throughout the network,’ Roberto Zagha, the World Bank’s Country Director in India, said in a statement.