German Dev Bank to Partly Fund Surat Metro; Depots to be Solar-powered

Budget reactions

The Government of India and the German Development Bank – KFW (Kreditanstalt für Wiederaufbau) – have signed a Euro 442.26 million loan for the Surat Metro Rail project, according to a recent official statement released by the Ministry of Finance. The project aims to harness solar energy at both depots of the Surat Metro in Gujarat. In recent years, India has become the global leader in terms of planned new metro projects, with 22 projects currently underway, including the operations ones at Delhi, Kolkata, Bengaluru, Mumbai, Hyderabad, Nagpur, Lucknow and more. With these projects already delivering positive benefits in terms of reduction in carbon emissions, going green with solar energy will increasingly be an option to buttress their ESG credentials. That in turn could help provide access to funding for these capital intensive projects.

Rajat Kumar Mishra, Additional Secretary, Department of Economic Affairs in the Ministry of Finance, signed agreements for Surat Metro Rail Project on behalf of the Indian government, while Ms Claudia Schmerler, Head of Division, Climate Finance and Urban Mobility, signed for KFW.

The total cost of the project has been revealed to be Euro 1.50 billion, out of which KFW is going to finance Euro 442.26 million. The project is being co-financed by the French Development Agency, AFD (Agence Française de Développemet). The agreement with AFD for Euro 250 million was signed on January 28, 2021.

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“The 40.35 km Surat Metro project aims to strengthen & augment the transport infrastructure of the Surat urban agglomeration. It will relieve traffic congestion and provide integrated town & land-use planning through transit-oriented development. The project also aims to build an integrated multi modal transport system in the influence zone of the metro corridor to provide first- and last-mile connectivity and improved access to the metro system. Further, solar energy shall be harnessed at both depots of the Surat Metro,” stated the Ministry of Finance in is statement.

The project is envisaged and planned to have a transformational impact in terms of creating a reliable & safer public transportation, bringing about a reduction in traffic congestion, cutting down long delays on major travel corridors in Surat city and urban areas by providing an integrated mass transportation system for the general public.

“The project shall have a positive impact on the living standards and environs of the city of Surat,” the statement added.

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Last month, Germany, Europe’s largest economy and powerhouse, announced new development commitments of over Euro 1.3 billion (approx Rs 10,025 crore) to India, aiming to assist the latter in its measures to push back against climate change and add more renewable energy.