Kerala - Thiruvananthapuram   

Panel cautions against KSTP second phase

P. Venugopal

Advises Government to ensure extra loan from World Bank first

THIRUVANANTHAPURAM: The steering committee for the Kerala State Transport Project (KSTP) is understood to have decided to advise the Government against taking up the second stage of the KSTP without ensuring additional financial assistance from the World Bank.

The steering committee consisting of top Government officials met here on Saturday against the backdrop of the severe financial crunch faced by the KSTP because of the cost escalation of the works under the project. Originally, this World Bank-aided project for upgrading 1,300 km of State roads was expected to cost Rs.1,600 crores. The KSTP now feels that the cost would go up by at least Rs.700 crores.

A fortnight back, the Government had decided to seek an additional assistance of Rs.528 crores from the World Bank. The request had to be approved by the Union Government also.

The main component of the second phase of the project is the upgrading of around 320 km of State roads.

The stretches that come under this phase are Chengannur-Muvattupuzha, Punalur-Thodupuzha (via Kozhencherry), Thalasserry-Valavupara (road to Mysore), Pappinisserri-Pilathara, Kanhangad-Kasargode and Iritty-Talipparamba.

First phase

Works in the first phase going on at present are along the stretches Taikkod-Chengannur (MC Road), Changanacherry-Alappuzha, Angamaly-Thodupuzha, Shoranur-Palakkad and Thrissur-Kuttippuram. Approximately 30 per cent of the total works under the project has been completed so far. This has consumed Rs.543.34 crores.

The steering committee advised the KSTP not to delay the first phase of the works beyond March 2006. This phase was to be completed by the end of this year.

To drop components

The indications are that the KSTP will have to drop several components of the works planned originally since it will be beyond the financial capacity of the State Government to bridge the gap between the assistance promised by the World Bank and the revised cost estimates.

Of the original project cost of Rs.1,600 crores, the World Bank's commitment was to provide a loan of Rs.1,216 crores.

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