Indian EXIM Bank to Provide Loan for Ethiopian Railway Project

Written by Meraf Leykun

Ethiopian Business News - Banking and Finance

The Export-Import Bank of India has provided USD 300 million loan to the Ethiopian Government railway project. The loan term entail concessional funds at an interest rate of 1.75 per cent.

The fund will be used to construct the railway project to connect the Ethiopian city of Asaita to the port city of Tadjourah in Djibouti. About 50 km of the 210-km long railway will be in Djibouti, while the rest of it lies in Ethiopia.

“Ethiopia being a landlocked nation, the railway link to a port city will provide impetus to growth, particularly in the northern region of our country,” Ahmed Shide Mehmad, the  Ethiopian State Minister for Finance and Development, said.

T.C.A Ranganathan, Chairman and Managing Director of EXIM Bank of India, said after signing of the agreement in New Delhi on Thursday.

Indian Exim Bank has preexisting loan agreements with the Ethiopian Government for the development of sugar factories.

A detailed project appraisal is being prepared by RITES, an Indian public sector enterprise, and it is expected to be submitted within two months, according to Ranganathan.

After financial closure, the Ethiopian Government is expected to call Indian companies, both public and private, for procurement.

Source: The Hindu Business Line