Kochi Metro is to get financial assistance worth about Rs 1500 crores from France.
The 'no-strings' financial help has to be repaid in 25 years and carries a low interest rate of 2.5 per cent. A team from France is to visit the state on September 17 to discuss the terms of the loan. There would be no pre-conditions for the loan and Kochi Metro would not be obliged to use technology from French companies in lieu of the loan.
Once the project is completed, there would be a moratorium of five years after which the debt needs to be repaid in 25 years. The Kochi Metro project needs about Rs 2170 crores in the first phase and already there are many offers from overseas lenders ready to invest in the project.
Once Kochi Metro is able to source the fund from France, Indian banks would be ready to finance the remaining amount.
Kochi Metro, which would be using 22 trains with three coaches each, would be buying signalling devices, telecom devices and coaches from abroad. It would be very convenient for project managers to receive funding in foreign currency for completing foreign purchases. Local funding would be ideally used for local expenditure