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Massive loan from China to rebuild roads
China will provide Sri Lanka a loan of US$ 500 million (Rs. 64.6 billion) for the second phase of the Government’s Priority Roads Project in the north and the south.
As a prelude to the project getting under way, the Government will obtain consultancy services. The Cabinet last Wednesday approved a proposal by President Mahinda Rajapaksa, as Minister of Ports and Highways, to award two local firms multi million rupee contracts for such services.
The firm handling the Southern Region — Consulting Engineers & Architects (Private) Limited — will receive Rs. 3,376,160,000 (excluding VAT) whilst the one handling the Northern Region – Resources Development Consultants (Private) Limited — will receive Rs. 401,404,000 (excluding VAT). The two firms have been picked by the Cabinet Appointed Consultants Procurements Committee (CACPC) after four firms were shortlisted.
President Rajapaksa has told his ministers in a Cabinet memorandum that the Government of Sri Lanka and the China Development Bank Company Limited (CDB) signed a Memorandum of Understanding (MoU) to establish a framework for cooperation. In terms of this MoU, the CDB has agreed to provide credit facilities to finance, inter alia, “infrastructure development projects with great significance to economic development.”
Stemming from this MoU, he has said, that the CDB has agreed to finance the Priority Roads Project to be implemented by the Road Development Authority under the Ministry of Ports and Highways.
With the US$ 500 million provided by the CDB, President Rajapaksa has told his ministers, 19 civil works have been awarded. These civil works are intended to rehabilitate 504.9 kilometres of roads in the Western, Southern, Central, Uva, Sabaragamuwa, North Western and North Central Provinces and 85 kilometres of provincial roads in the Nuwara Eliya District.
Two new flyovers at Hambantota are also to be constructed with the same funding. The Ministry of Ports and Highways has grouped the work to be undertaken into two regions — Northern and Southern. President Rajapaksa has said the Road Development Authority intends to employ separate local consultancy firms for construction supervision of the project in each region. The funds required to incur the cost of such consultancy are to be drawn from the Consolidated Fund.
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