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The Uttar Pradesh government is mulling 100 per cent external funding for the proposed Lucknow Metro project.
Japan International Cooperation Agency (JICA) is the frontrunner as the prospective funding institution, given the vast experience it has in funding such other projects in India.
While the exact funding model for the ambitious project, estimated at almost Rs 20,000 crore, is still to be finalised, there is high possibility of the state marshalling funds on its own through long term credit.
Earlier, the project had been envisaged to be funded 50:50 by the Centre and UP on the lines of Delhi Metro Rail Corporation (DMRC) and as suggested by the union urban development ministry.
"We are still working (on) the funding model for the project and there is high possibility we may even go for 100 per cent debt funding," Madhukar Jetley, advisor to UP government (externally aided project) told Business Standard .
He said JICA was "keen" to provide the funding and the repayment period was likely to be higher at 40 years compared to 30 years for Delhi Metro.
The project has been put in top gear following the Cabinet approval on June 27, 2013.
"The special purpose vehicle (SPV) of Lucknow Metro Rail Corporation (LMRC) is in the process of being incorporated and it would be an entity by next week," he informed.
The Lucknow Metro project would be put before the Centre for its in-principle approval.
"We are confident things will start to move on the ground by December this year," said Jetley, who holds minister of state rank in the State.
Lucknow has a population of over 3 million. There has been tremendous horizontal growth in the state capital with rapid development of sub-urban areas.
In such a scenario, a modern urban rapid rail transit system is imperative for a growing city like Lucknow to facilitate faster commuting.
