Japan's overseas development agency said Monday that it has agreed to lend funds for a new USD 1.5-billion light rail system for Sri Lanka's congested capital Colombo.
Under the deal, Japanese technology including rolling stock and electromechanical equipment will be utilised in the project, it added.
The Light Rail Transit (LRT) system with 16 stations over 15.7 kilometres (9.8 miles) will operate on an elevated track in and around Colombo. "It will fundamentally change the face of public transport in this country, ease traffic congestion and improve the environment of Colombo city," the statement said.
The Japanese loan carries an interest rate of 0.1 percent and is repayable over 40 years with a 12-year grace period, JICA said.
Japan has already funded sections of new expressways and a key bridge to reduce traffic congestion in and out of the capital.
Sri Lanka has seen a massive rollout of ports, highways and railroads in recent years but several ambitious infrastructure projects ended up as white elephants and left the country facing a mountain of debt -- mainly to China.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)