Four-lane elevated expressway more costlier than the LRT
The ongoing construction of a four-lane elevated expressway connecting the Athurugiriya interchange and Kelani Bridge is more costlier when compared to the Japanese funded Light Railway Transport (LRT) project scrapped by the government citing the reason as financial constraints, according to Treasury sources.
China Harbour Engineering Corporation (CHEC), which is already carrying out several mega projects in the country, has been awarded this flyover expressway contract.
The project is being implemented under the build, operate and transfer model with a Chinese loan of US$ 1620 million which should be repaid in 15 years in installments of $108 million per annum at huge interest rate cost, the sources said.
Both projects were aimed at providing a sustainable solution to traffic congestion to a corridor in Colombo that has the highest vehicle growth and biggest traffic jams at the moment.
Quoting Finance Ministry estimates, the sources said the total construction cost for the four-lane elevated expressway 16.4 km in length was $1620 million compared to the 16.7 km LRT project costing $1374 million.
The total cost for LRT included the fixed cost components such as system costs for electrical and mechanical systems, communication and signal systems together with rolling stock and maintenance yard and 17 railway stations, according to these estimates.
However the government, cancelled the Japanese International Cooperation Agency (JICA)-funded Phase I of the LRT project in September last year on the grounds that it had ‘limited use’ covering only 16.7 km from Malabe to Fort, and, (considered) it’ was ‘costly, the sources said.
A $1.8 billion Japanese soft loan was secured at that time (with annual interest at 0.1 percent for civil work and 0.01 percent for consultancy services), where the amount calculated by considering dollar fluctuations is to be repaid in over 40 years with a 12 year grace period.
Without considering all these benefits at a time where the country is facing a severe forex crisis, the government is going ahead with elevated expressway project at a cost of $1620 million whereas it could have completed the LRT at a cheaper cost, former Minister of Megapolis Patali Champika Ranawaka alleged.
Mr. Ranawaka told the Business Times that people will soon realise the severe financial loss and repercussions of the present project and the cancellation and the style in which it was done might adversely affect Sri Lanka’s image as a desirable investment destination.
A senior official of the Highways Ministry noted that the elevated expressway from the New Kelani Bridge to Athurugiriya is being implemented in accordance with 2021 budgetary estimated limits.
He added that as part of the project five new flyovers would be constructed and is expected to collect Rs. 3.3 billion semi annually as the toll fee as a return of investment .