FinMin to seek World Bank funds for railways shortly
New Delhi: The finance ministry will shortly make a formal reference to the World Bank for a loan to the Railways. The loan is required for part-funding the ambitious National Rail Vikas Yojana.
Informal discussions between the two sides have already taken place. Though the exact amount of the proposed loan is yet to be decided, $100 million is expected to come in the first phase for safety enhancement works that will be followed by another tranche of $400-million.

Initially, the loan is being sought for safety enhancement work on the New Delhi-Howrah line that forms one arm of the Golden Quadrilateral, say senior officials.

According to the plan charted out by the Railways, two mega bridges at Mongher and Kosi in Bihar will be part of the safety enhancement package to be funded by the Bank. The bridge at Mongrer is estimated to cost Rs 900 crore, while the bridge on the Kosi at Nirmali will cost Rs 325 crore. These two bridges are expected to give an economic rate of return of 16 per cent though the financial return to the Railways may not be very high.

Senior officials also say the Railways will take up the work on the foundation structure for these bridges through its own resources, and that the Bank funding will be taken up for construction of the super structure.

The Rs 1,700-crore bridge at Bogibeel over the Brahmaputra in Assam will be proposed to the Bank separately. "We are carrying out socio-environmental impact studies for the Bogibeel bridge project,"said a senior official.

The four mega bridges, entailing a total cost of Rs 3,500 crore, form part of the National Rail Vikas Yojana along with the GQ and port connectivity projects
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CII scales up GDP estimate to 7.2%
New Delhi: The Confederation of Indian Industry (CII) has stepped up the gross domestic product (GDP) growth outlook to 7.2 per cent for 2003-04 from its earlier estimate of 6.5-6.8 per cent. The revision has been made in CII’s survey on the state of the economy study up to September 30.

"This upward revision in growth to 7.2 per cent is due to excellent monsoon, higher expected foodgrain output and agricultural income, and significantly better performance of the industrial, manufacturing and service sectors," said CII chief economist Omkar Goswami.

The study predicts a 7.5 per cent growth in the agricultural sector which according to the chamber is not an optimistic one, given that there was a significant reduction in agricultural output because of the drought in 2002-03, and that the growth would be over a smaller base, a release said.

"Indeed, given decent rains in winter, it is quite possible that agricultural growth could exceed 8 per cent," said Dr Goswami. The industrial sector that comprises mining, manufacturing, electricity and construction, is expected to grow at 6.3 per cent during this fiscal, according to the study. "Order books of companies in the manufacturing sector are more full than they have been in the last four years. First half revenues have been higher than before, profitability is up and there is a general sense of optimism,' Dr Goswami said.

The services sector that accounts for half of the GDP, has been projected to grow at 7.5 per cent. During the past 10 years, the sector has maintained growth above 7 per cent.

According to the study, agriculture will contribute 1.8 per cent growth to the overall GDP (7.5 per cent growth multiplied by a weight of 24 per cent), industry 1.6 per cent, and services 3.75 per cent, making a total of 7.2 per cent. "To sustain this excellent growth in the future, India needs to focus on accelerating the process of eco reforms and to concentrate on building infrastructure," said Dr Goswami.
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