HANOI: Nguyen Quang Manh, director of the Ha Noi Train station-Nhon urban metro rail project’s board, announced at a meeting with the Ministry of Transport the signing of additional loan agreements.
The project had initially received investment capital of 783 million euros (US$733 million). However, after several years of construction, this investment capital has been adjusted to more than 1.17 billion euros ($1.09 billion), an increase of nearly 400 million euros ($374 million). At the meeting with the Ministry of Transport on Thursday, Manh said the board was signing the additional loan agreements with sponsors to get more money for the project.
The concerned ministries were obliged to report the increase in the project’s investment capital to the Government. According to representatives of the sponsors, the slow progress of site clearance might be among the reasons for the situation.
Deputy Minister of Transport Nguyen Hong Truong said site clearance and arrangements for resettlement were very difficult, as the urban railway passes most of the city’s residential areas. Therefore, sponsors should consider the problem carefully and handle it properly.
Until the adjustment in investment capital is verified, the Nam Thang Long-Tran Hung Dao urban railway has been asked to pause construction. The project was approved in 2008, and construction began in December 2013, with an estimated investment capital of VND19.5 trillion ($858 million).
However, the project has yet to be implemented, as it is still awaiting approval for the increase in its investment capital to VND51.7 trillion ($2.2 billion) from the Ministry of Planning and Investment.
Manh said the delay in receiving the ministry’s approval had prevented the project from finding financial sources. By the end of next year, the loan agreement with JICA, the main sponsor of the project, will expire. Manh said the Ministry of Planning and Investment had hired a consulting firm to evaluate the projects and plans to release the official report on the situation next April.
