Tuesday, August 13, 2013

Kathmandu Metro Railway Project

Kathmandu Metro Railway Project The government is considering to hand over Kathmandu Metro Railway Project to Nepal Metro Private Limited.  About three months ago, the company had submitted a proposal at the Investment Board (IB) to carry out the detailed study and build the metro railway—a mass rapid transit—in partnership with Korean companies.

A final report on feasibility of the metro railway prepared by the government-hired consultant shows it costs $3.88 billion (Rs 330 billion) for building the metro railway system in the Kathmandu. However, the Nepal Metro has been saying that it would build the metro in Kathmandu investing $ 3 billion.

“If the company signs bond with enough Korean firms and come up with technical and financial capabilities required for this type of project, IB could assign the project to work in joint venture,” said a source at the IB. The source said that the Kathmandu metro, being a huge project, would be decided based on in-depth study over the proposal, feasibility report and its benefit to the government and to investors.

After nearly a year of study, consultants consisting of a consortium of Korean (Chungsuk Engineering Company, Korea Transport Institution, Kunhwa Consulting and Engineering Company, Korea Rail Network Authority) and Nepali (Research Management Consultant Environmental and Building Design Authority) firms recently submitted a final feasibility report to the Railway Department. The report says that it will cost around Rs 330 billion to build a 77-km-long metro system in Kathmandu in next 10 years.

According to officials at the department the Nepal Metro had also assured the IB that it would reimburse to the government Rs 60.5 million spent on the feasibility study. There will be five lines of metro railway—four lines planned for inside the Ring Road and one line of 27.35 km running around the Ring Road.

With no resources for detailed project report (DPR) and less chances of the government undertaking the project in future, the IB was mulling to accept the Nepal Metro’s proposal, according to the IB source. The government, after the completion of feasibility study, was supposed to carry out a detailed study to build the metro railway—also a part of the national priority railway development project.

However, officials at the Ministry of Physical Planning, Works and Transport Management said that there was no resource to carry out the DPR due to this year’s budget being limited to two-thirds. “No budget has been allocated for the DPR of the metro railway,” said Tulasi Prasad Situala, secretary at the ministry. He also informed that the IB might entrust the metro project to Nepal Metro after studying the company’s proposal, its Korean parties and capacity.

Earlier, the Ministry of Physical Planning, through the Finance Ministry, had requested the South Korean government and the Asian Development Bank to conduct the DPR for the metro. However, the Railway Department officials said they have not received any response till date.