Thailand and Japan have signed a loan agreement in which Japan will provide Thailand an initial batch of 63 billion yen (about 643 million USD) in loans to finance the construction of a mass transit rail system in Thailand, local media said.
According to Thai news agency (TNA), the railway project was aimed at providing safe and efficient transport throughout a much larger portion of the metropolitan region, as well as easing traffic congestion on the outskirts of Bangkok.
Under the agreement, the Japanese government will provide the first batch of loans amounting 63 billion yen to the Thai government through the Japan International Cooperation Agency (JICA) to finance building mass transit rail system between Bang Sue and Rangsit in Bangkok’s adjacent province of Pathum Thani.
The route is part of the so-called red route which runs from Rangsit passing through Bang Sue and Hua Lampong railway stations to Mahachai in Samut Sakhon province.
JICA will charge 1.4 percent interest annually on goods and services procurement which can be made from any supplier in the world and 0.01 percent annual interest on consultant fees. The repayment period is 25 years, including a seven-year grace period./.