Commercial agreement for Northern railway line signed

The commercial agreement for the construction of the Northern Railway Line between Medawachciya and Madhu Road was signed yesterday at the Ministry of Transport in the presence of the Transport Minister Kumar Welgama and Indian High Commissioner Ashok K. Kantha.

The agreement was signed on behalf of IRCON Internatiol (Government of India Undertaking, which will construct the railway line) by IRCON, GM, S.L. Gupta and on behalf of Sri Lanka Railways by Sri Lanka Railways GM P.P. Wijesekara. The agreement envisages reconstruction of the 43 kms track between Madhu Road and Medawachchiya at a cost of USD 81.3 million, which would be funded under a Government of India credit line, a press release states. High Commissioner Kantha noted that the line of credit of USD 81.3 million is part of a larger package of assistance directed at the rehabilitation of railway infrastructure in the Northern Province of Sri Lanka, for which Government of India has committed a total amount of US$800 million in lines of credit on highly concessional terms.

He mentioned that the two sides had earlier this year concluded agreements for the construction of the Omanthai-Pallai and Madhu Talaimannar sections, also backed, respectively, by Indian lines of credit worth US$ 85.35 million and US$149.74 million. Work on the Northern Railway Line is expected to start from October 2010.

India is also assisting in the rehabilitation of the Colombo-Matara rail link through a line of credit of US$167.4 million. Work on the Colombo-Kalutara sector of this line is already at an advanced stage and the work on the Galle-Matara Section (42 Kms) is likely to complete by December 2010. The reconstruction of transport-related infrastructure is an essential requirement for the restoration of normal life in the Northern Province as it would both generate and support livelihood-related activities and also assist in restoring connectivity, not only between Northern and Southern Sri Lanka but also between Sri Lanka and India. India remains committed to continuing its assistance to Sri Lanka as it undertakes the important and challenging task of reconstructing the Northern Province.