World Bank’s assistance to boost trade across India’s eastern borders

India gets second loan of $1.1 billion for the Eastern Dedicated Freight Corridor (a freight-only rail line) between the north and eastern parts of India The Dollar Business

Rail routes in the Golden Quadrilateral connecting Delhi, Mumbai, Chennai and Kolkata, account for 16% of the railway network’s route length, but carry over 60% of India’s total rail freight, according to the World Bank

The recently signed $1.1 billion agreement between India and the World Bank towards the second loan for the Eastern Dedicated Freight Corridor (DFC) is expected to boost India’s trade with Bangladesh and other countries across India’s eastern borders. The Eastern Dedicated Freight Corridor is a freight-only rail line and will improve the speed and efficiency, while reducing transport costs in the movement of goods between the Ludhiana in the north and to Kolkata in east, said the World Bank. The DFC will also help in establishing manufacturing clusters along the corridor, and around seven integrated manufacturing clusters are being planned on either side of the DFC. The Ludhiana – Kolkata DFC project was approved by the World Bank on April 22, 2014, and this is the second loan after the first loan of $975 million was approved for the 343 km Khurja-Kanpur section in the EDFC by the World Bank in May 2011. Overall the DFC will cover 1,839 km and will also help reduce greenhouse gas emissions by 2.25 times over a 30 year period, according to experts. “Implementing the Dedicated Freight Corridor program will provide India the opportunity to create one of the world’s largest freight operations, adopting proven international technologies and approaches which can progressively be extended to other important freight routes throughout the network,” said Onno Ruhl, World Bank Country Director in India. The completion of the DFC will play a key role in improving India’s trade under its “Look East” policy. “An improved eastern corridor will contribute to the development of the proposed Trans-Asian Railway involving infrastructure investments in India, Bangladesh, and countries further east,” said Dr. S.P. Sharma, Chief Economist, PHD Chamber of Commerce.

This article was published on December 22, 2014.

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The Dollar Business Bureau - Dec 22, 2014 01:35 IST

World Bank’s assistance to boost trade across India’s eastern borders

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