THIRUVANANTHAPURAM: The Kerala Rail Development Corporation (K-Rail) has told the government that a one-year delay in the SilverLine project due to political opposition and protests would cost an additional Rs 3,500 crore and make it difficult to get foreign loans.

The project is estimated to cost Rs 66,405 crore. This includes the cost of land, compensation and construction cost. There will be a five percent increase every year due to inflation. The cost of construction materials and labour will go up. The cost was estimated as Rs 66,495 as per the figures of 2020. An additional expenditure of Rs 7000 crore came up when the plan document was updated. Railways have proposed to update the estimate.

The government is trying to get the final approval and start construction as soon as possible. It has assured the Centre and the NITI Aayog that the state will bear the additional cost. The Chief Minister had promised in person in Delhi that the state government would take over the liabilities of Rs 33,700 crore in foreign loans. He also informed the Prime Minister in a letter that the state would bear Rs 13,700 crore for land acquisition.

What next

• Need to get the approval of the Ministries of Railways, Finance, the Prime Minister's Office and the Union Cabinet
• 185 hectares of railway land worth Rs 975 crore and central share worth Rs 2150 crore
• Foreign loans. JICA has offered loans at an interest rate of 0.2-0.5 percent. ADB is ready to lend Rs 7500 crore at an interest of 1.5 percent.

Doubts raised by Railways and K-Rail's response

1. Loss of revenue: With the advent of the SilverLine, the Railways might witness a decrease in the number of passengers and this will cause a loss of revenue. According to the DPR, 13 per cent of existing train passengers will switch to the Silver Line

Response: A large number of people are forced to travel by road due to the unavailability of train tickets. With these people switching to train, the Railways will not suffer any loss.

2. Passengers: The DPR estimates that by 2025 there will be an average of 79,934 passengers per day. This can be up to 1.14 lakh. It is said that 10-38 per cent of those who travel more than 150 km by road and rail will switch to the SilverLine.

Response: A study by the DMRC for high-speed rail in 2014-16 estimated that there will be 80,000 passengers per day by 2020. The ticket rate was Rs 5 per kilometre. These many passengers are expected in 2025. The ticket rate will be Rs 2.75 per kilometre.