USD 975 million World Bank loan for DFC of Railway
The financing for the project will cover 1,130 km of the 1839 km corridor which will connect Ludhiana in Punjab to Dankuni in West Bengal. The funds will be provided in three phases and the agreement signed today will be for the first phase between Khurja and Kanpur covering 343 km, said railway sources.
The DFC proposes to help faster and more efficient movement of raw materials and finished goods between the Northern and Eastern parts of India. The corridor will also allow Indian Railways to free up capacity from the existing train corridor and better-serve the large passenger market in this densely-populated region.
Railways have already tied up with Japanese government to fund its Western corridor linking Tughlakabad to Mumbai. The loan, from the International Bank for Reconstruction and Development (IBRD) under World Bank, has a maturity period of 22 years including a 7-year grace period, an official statement said.
The Western and the Eastern corridors promise to accelerate the pace of economic growth and help railways get a quantum leap in increasing its transportation capacity by building
high-capacity, high-speed dedicated freight corridors along the golden quadrilateral the four
rail routes that connect Delhi, Mumbai, Chennai, and Kolkata.
Currently, these routes account for just 16 per cent of the railway network, but carry more than 50 per cent of the total freight. DFC aims at shifting drastically road freight to railways thereby reducing the carbon footprint and green house gas.
Unlike the existing rail network, which runs on a combination of diesel and electrical locomotives, the proposed DFC corridor will operate entirely through electric locomotives, thereby further reducing GHG emissions. Road freight now accounts for about 65 per cent of the freight market and 90 per cent of the passenger market in the country. A carbon footprint analysis conducted by DFC corporation for the Eastern DFC project shows the corridor is expected to cause 2.25 times less carbon emissions, the statement said.