Nuwara Eliya Cable Car project hits financial hurdle
The million dollar cable car project proposed under the government’s ambitious Nuwara Eliya tourism zone development initiative after receiving the cabinet approval, has got stuck in financial and environmental issues, according to official assessment reports and relevant documents.
The Cabinet of Ministers approved the project in 2019 during the previous regime and it was re-introduced under the present government’s tourism zone development initiative on the directions of the president.
The present government has directed the subject ministries and the Treasury to make a reassessment and validate it again balancing financial and environmental considerations, the reports say.
There were costs overruns between the new project proposal of Dopelme Cable Car Company of Austria and its local partner Outdoor Engineering Lanka Ltd and its previous proposal in 2019, raising issues of financial and operational feasibility, an internal government audit inspection divulged.
According to the audit report, the estimated cost of the project indicated in 2019 cabinet proposal was U$50 million while in the new proposal it has jacked up to $63.1 million. The cost for the project has increased by a staggering $13 million despite having no changes from the previous proposal, the audit query pointed out, as the government has to eventually pay the investor.
The Austrian company has proposed to levy Rs. 5000 per person for a cable car ride from Nanu Oya to Nuwara Eliya while also planning to lease out the dedicated restaurant and lounge area spaces to the private sector that are to be built in parallel to the project.
The implementation of the cable car project is yet to get clearance of the Central Environmental Authority (CEA) and Forest Department.
The project was proposed to cover a 6km stretch from the Nanu Oya train station to the Nuwara Eliya Race Course.
The government has decided to acquire the plots of land which are currently vested in relevant line ministries and agencies including the Department of Railways, Nuwara Eliya Municipal Council, Forrest Department and Department of Wildlife Conservation, the documents show.
These land plots of around four hectares will be brought under the purview of the Urban Development Authority (UDA) and leased to the company to implement the project, it said.
The President has issued a directive to expedite development projects in the Matale, Kandy and Nuwara Eliya Districts in a bid to boost the economy in the Central Province as well as to revive the tourism industry in the region, the documents revealed.
Accordingly, the Nuwara Eliya Race Course will be developed in accordance with international standards and in parallel a football field, an athletic practice ground, two volleyball courts, two basketball courts, a cricket stadium, a cable car project, walking path, an horse race lane, a carnival complex, a stable and a network of restaurants are to be built.