Cabinet agrees to seek Japanese funds for Red Line project

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BANGKOK, 9 June 2015 -The Cabinet has approved a plan to borrow 10 billion baht from Japan to fund the second phase of the Red Line electric train project on the Bang Sue-Rangsit section. 

According to Deputy Government Spokesperson Maj Gen Sansern Kaewkamnerd, the Cabinet this week gave the green light to a draft loan agreement proposed by the Ministry of Finance which is to be signed between the Thai government and the Japan International Cooperation Agency (JICA).

Under the deal, the Finance Ministry will be responsible for obtaining a loan worth 10 billion baht from JICA and disbursing it to the State Railway of Thailand for use in the construction of the Red Line electric train system, stretching between Bang Sue and Rangsit.

Maj Gen Sansern affirmed that the loan is necessary as it will enable the government to keep up with the goal of enhancing the country’s public transport system and laying down infrastructure in support of urban community development.

Another amount of 22.78 billion baht has also been borrowed from JICA in 2009 for the first phase of the project and the loan period is due to end this month. For the second phase, the 10-billion-baht loan will have a period of 20 years, with an interest rate of 0.4 percent and an interest-free period of six years.