The Beijing-based Asian Infrastructure Investment Bank (AIIB) has approved a USD 356.67 million loan for the expansion of the Chennai metro rail system, taking the bank’s financing for various projects in India to USD 6.7 billion, making the country its largest beneficiary.
Launched in 2016, the AIIB is a multilateral development bank that aims to support building of infrastructure in the Asia-Pacific region. China is the largest shareholder of the bank with 26.06 per cent voting rights. India is the second-largest shareholder with 7.5 per cent followed by Russia at 5.93 per cent and Germany at 4.5 per cent. The Chennai project involves the construction of a new corridor in Chennai’s metro network as part of its Metro Rail Phase 2, AIIB Vice President for Investment Operations D J Pandian said on Thursday.
With this loan, the bank has so far approved 28 projects in India amounting a total of USD 6.7 billion, said Pandian, who oversees all sovereign and non-sovereign lending for the AIIB in South Asia, the Pacific Islands and South-East Asia. The energy and transport sectors have received the highest amount of financing from the AIIB, he said.
After China, India is the second-largest shareholder of the bank and is also its largest beneficiary in terms of getting approvals for many projects, he said. Besides funding various infra projects, the bank also granted USD 1.75 billion to India for COVID-19 relief budget support, which included help for social protection and assistance to Micro, Small and Medium Enterprises (MSMEs), Pandian said.
The other AIIB major Infra projects for India included USD 335 million for Bangalore metro, USD 400 million for Andhra Pradesh Urban Water project, USD 105 million for Kerala Solid Waste Management, USD 125 million for Resilient Kerala, USD 500 million for Mumbai Urban Transport Project-3 and USD 500 million for Delhi Meerut Rapid Transport system, he said.
The Chennai Metro project is “aligned with AIIB’s mandate to support high-quality and sustainable infrastructure”, said Pandian, who previously served as the Chief Secretary of Gujarat. “The improvement and integration of the transport sector in Chennai will further promote trade and economic growth,” he said.
Pandian recently visited Chennai and reviewed the progress of the metro project. He also called on Tamil Nadu Chief Minister M K Stalin and the state’s Finance Minister Palanivel Thiagarajan. The metro project will span from Lighthouse in the east to Poonamallee Bypass in the west to ensure seamless multimodal transport across Chennai by providing integrated access to suburban rail, bus stations and the city’s main airport, he said.
The project will address traffic bottlenecks and reduce greenhouse gas emissions by increasing public urban transport options. Its design and construction will have environmentally friendly features to help reduce its carbon footprint, Pandian said. In addition to solar panels installed on the roofs of the elevated stations, the project will have dedicated spaces for bicycles and green vehicles, and signage to raise environmental awareness. The project also integrates climate change resilience features to reduce its vulnerability to climate-related events, Pandian said.
Women would be benefited from the project as they will have access to a safer and convenient mode of public transportation with knock-on effects such as increased opportunities to participate in school, work and social activities, he said.
The project will provide enhanced accessibility and connectivity as well as increased economic opportunities for the residential and commercial establishments along the new corridor, Pandian said. The AIIB has 103 approved members worldwide.