The project will be implemented with central assistance.
The state cabinet, which met today in the presence of Chief Minister Pinarayi Vijayan, gave in principle sanction for the project.
Cabinet also decided to set up Kerala Blood Bank society of International standards.
It will be set up jointly by Thiruvananthapuram Citizens India Charitable Trust, Health Department with technical assistance of WHO.
The government also decided to strengthen the Public Works Department's design, investigation and quality control wings.
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