The World Bank (WB) on Tuesday approved a loan-cum-interest-free component of $542 million for the Mumbai Urban Transport Project (MUTP) which aims to ease congestion for Mumbai city.
The metropolis' population is estimated at 14 million and is projected to grow to 22 million over the next decade.
The MUTP project is expected to cost $945 million, of which $463 million would be in the form of a loan provided by WB, while $79 million would be in the form of an interest-free credit.
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The loan component would be repayable over 20 years with a five year grace period, while the credit support would be repayable over 35 years with a grace period of 10 years.
The project, broken up into three phases, seeks to enhance the suburban rail capacity and service quality, improve road traffic conditions and resettle nearly 20,000 families staying near the railway tracks.
Edward Dotson and A K Swaminathan, the co-task leaders assigned by the WB for the project, in a joint release said: "MUTP focuses on public transportation and will improve quality of life in the Mumbai metropolitan region by fostering the development of an efficient, comfortable and sustainable urban transport system, including effective institutions to manage it."
The rail transport enhancement phase aims to improve the capacity and performance of the suburban rail system by providing new trains, upgrading existing trains, adding some new railway tracks, and improving signaling, electrical and telecommunication systems.
The second component dealing with the road-based transport will facilitate the construction of two new east-west links across greater Mumbai, better facilities for pedestrians, advanced traffic signal systems and improvements in the efficiency and quality of public transport services. Motor vehicle pollution would also be curbed.
On the resettlement front, the Maharashtra government would be assisted to rehabilitate 20, 000 families. The resettlement process that commenced during the preparatory stage of the project itself has so far witnessed 10, 000 families shifting to permanent or transit housing.