India has assured Nepal a new line of credit for a 76-km expressway to connect the capital city to a site in the country's south where a new international airport has been planned, besides offering to construct the $650-million new aviation facility.
Officials here said the new line of credit -- for which an in-principle clearance has already been accorded by New Delhi -- is for the Kathmandu-Nijgadh Fast Track Road. The airport proposed at Nijgadh is to cater for 15 million passengers annually and to also handle the super jumbo Airbus 380.
India's commitment was made during the 3rd Bilateral Line of Credit (LoC) Review Meeting between the two sides here on Monday and Tuesday. The Nepali side indicated that some further assistance may also be sought from India towards extending financing to developers.
"We have informed them about it," said Madhu Marasini, chief of international economic cooperation coordination division at the Nepali finance ministry.
Giving some background on the projects, officials said the feasibility report prepared by the Asian Development Bank (ADB) in 2014 has estimated the road project to cost $960 million -- the latest figures, however, peg it at $1.12 billion.
They said the new airport can potentially become an air hub for 27 cities in South Asia and generate over 100,000 jobs. India's External Affairs Minister Sushma Swaraj had in June urged the Nepal government to expedite the expressway and airport projects.
"Work on construction of the Nijgadh airport with India's participation should be expedited. These projects will create new job opportunities, contribute to revenue, and facilitate long-term recovery," Swaraj had said at a global conference on Nepal's reconstruction here on June 25.
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Even as a section of political parties here have launched protests against the project, experts see the twin-projects helping travellers to zip between Kathmandu and Nijgadh in less than an hour and connect with a host of countries cross the globe.
Since 2006, India has pledged lines of credit worth $100 million, $250 million and $1 billion. Of the $1 billion line of credit announced by Indian Prime Minister Narendra Modi, Nepal has identified projects worth $500 million for roads, bridges and irrigation.