KMC to sign MoU on monorail with IBN today
Kathmandu, May 15
Kathmandu Monorail Company (KMC) and Investment Board Nepal (IBN) are scheduled to sign the memorandum of understanding (MoU) of detailed project report (DPR) of Kathmandu Monorail Project on Wednesday.
The MoU signing had been delayed because the signatories were at odds regarding some of the provisions included in the draft agreement, one of which stated that KMC should deposit Rs 100 million as performance guarantee before carrying out DPR of the project.
While KMC had said it will deposit performance guarantee after signing the agreement, IBN had demanded that the money be deposited before MoU was signed.
“Like with the other contentious issues, we will resolve this disagreement and sign the MoU tomorrow itself,” said DN Thapa, chairman of KMC.
IBN Spokesperson Uttam Bhakta Wagle also confirmed that the MoU signing has been slated for Wednesday afternoon.
As per Thapa, DPR will be completed in a year. “It will take another six months to prepare the necessary paperwork, following which, we plan to initiate the construction of the monorail project. This means that if everything works out as planned, the construction will begin in the next 18 months.”
Issuing a media release today evening, Thapa further said, “What we can tell you now is that the development of the monorail will be undertaken in a holistic manner. Should the government of Nepal approve our proposal, we will progressively contribute to the transformation of Nepal, creating various opportunities and value-added lifestyle.”
In December 2016, KMC had inked a joint venture agreement with Powertek Sdn Bhd of Malaysia to construct a monorail along Kathmandu Valley’s Ring Road. KMC will have 70 per cent stake, while the Malaysian company will have the remaining stake in the project, which will span over 28.55 kilometres. The monorail will be developed utilising 90 per cent of foreign investment. Powertek will make consortium investment along with Savan Development Co of Laos and The Angel CoFund UK.
KMC has planned to construct Kathmandu Monorail Project under build, own, operate, transfer (BOOT) model.
The feasibility study of the project has shown that construction of the monorail will cost almost Rs two to three billion per kilometre. The project, which envisions constructing the monorail at a height of above 14 feet from the ground level, will be able to transport up to 150,000 passengers on a single day, Thapa informed.
“Construction of a monorail in Kathmandu is urgently required to manage the traffic congestion. As monorail will run on electricity, this means of transportation is pollution-free as well,” mentioned Thapa, adding that the concerned government authorities should facilitate in executing this project effectively.
According to the MoU that is to be signed tomorrow, the project is to be handed over to the government 35 years after commercial operations commence. Also, international investors will be provided their principal and interest on investment within 12 years of commercial operation of the project.