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Central Expressway: Govt. looks for foreign investor
The Government is to raise more than Rs 600 billion by way of foreign loans, Treasury Bonds or debentures for the completion of the Central Expressway project after deciding to leave out Japan and China — countries which initially negotiated to fund parts of the project.
Despite the adverse economic situation which has prompted the Government to put on hold several mega projects, the Cabinet this week approved the proposal to raise funding for the projects which are overdue by more than five years.
For the Dambulla-Kurunegala stretch spanning 60 Km, the former government was banking on a loan from China’s Exim Bank, but due to a delay in release of the loan and with indications that it would take another three more years, the Government has decided to look for
a foreign investor with a loan amounting to Rs 168 billion.
“We have some proposals for this loan, but will consider new proposals as well for this part of the project,” a senior Treasury official said.
For the 32-km Pothuhera-Galagedara stretch, the Expressways’ third phase project costing Rs 165 billion, the former government was depending on a loan from Japan, but due to a delay caused by the imposition of stringent conditions the Government has decided to look for other investors. Among the conditions was that in the event of a dispute, Sri Lanka would have to file action in a Japanese court.
For phase one of the project between Kadawatha and Mirigama, covering a distance of 37.9 km, China has already approved US$ one billion, but the Government has so far not been able to raise its component of Rs 32 billion to activate the loan.
For this part of the project, the Government plans to issue Treasury Bonds and debentures or bank on a foreign loan.
For phase two covering a 39.2 km stretch from Mirigama to Kurunegala, the Government hopes to follow a similar scheme for funds.
The Government needs Rs 40 billion to pay up local contractors involved in the project.
Meanwhile, the Cabinet has also decided to raise foreign funding for the Ruwanpura expressway project between Kahathuduwa and Ratnapura.