Recession in Japan will not impact JICA's loan to Mumbai Trans Harbor Link project

An official said the project will de-congest Mumbai by improving connectivity between the island city and the mainland

The Bharatiya Janata Party (BJP) government in Maharashtra and the state-run Mumbai metropolitan Region Development Authority (MMRDA) on Wednesday said they didn’t see any problem in getting loan from the Japanese International Co-operation Agency (JICA) for the Rs 11,000-crore Mumbai Trans Harbour Link (MTHL) project though Japan had slipped into recession.

Both the government and MMRDA are pursuing the matter with JICA and hope to get its clearance for loan.

 

An MMRDA official, who did not want to be named, told Business Standard: “Notwithstanding Japan falling into recession, we are quite confident that JICA will provide loan for the project. A JICA team, which held talks with MMRDA officials in July, had indicated that it may give up to 80 per cent loan for the project, which is about Rs 8,800 crore. The state government and MMRDA are pursuing the matter with JICA and quite optimistic for its approval in next two months.”

 

The official said Chief Minister Devendra Fadnavis reviewed the status of the project. The chief minister might take up the loan issue with the Centre.

 

Business Standard had reported about JICA’s desire to provide up to 80 per cent loan for the project.
 

The official said the project will de-congest Mumbai by improving connectivity between the island city and the mainland (Navi Mumbai).

“Already MMRDA has taken a decision to undertake the construction on cash contract wherein contractor will be appointed through a competitive bidding to complete the project. MMRDA will own the project,” he said.

 

The official though admitted that the decision to develop the project on a cash contract was taken after bidders stayed away during the bidding process conducted last year.

He said the UPA-II government had already approved 20% of the project cost as viability gap funding (VGF). However, he added that the VGF arrangement will not apply to the cash contract model.