Saudi gives US$ 46 m for Kalu Ganga project

The Saudi Fund for Development has agreed to provide a loan equivalent of US$ 46 million (Rs 5,200 million) for the Kalu-ganga Development project.

The loan is provided on highly concessional terms at an interest rate of two percent per annum repayable in 20 years including a grace period of five years.

The Kalu Ganga Development project is a part of the Mahaweli Development program and is interlinked with the implementation of Moragahakanda Development project. The project's main objectives are to increase the availability of irrigation and drinking water, expand the existing irrigable areas in Kalu-ganga basin and thereby increase food production and improve the standard of living of people in Matale, Anuradhapura, Polonnaruwa and Trincomalee districts.

The project includes three phases. The total estimated cost of Phase I of the project is US $ 167 million and the estimated cost of the Kalu Ganga dam which is the main construction component of the Phase I of the project erected at Pallegama with height of 67 metres and length of 546 metres and two saddle dams is US$ 102.2 million.

Of the funding requirement of this component, US $ 46 million is provided by the Saudi Fund for Development.

The balance foreign funding requirement of the dam construction is provided by the Kuwait Fund for Arab Economic Development and the OPEC Fund.

The Loan Agreement for the Kalu Ganga Development project was signed by Finance and Planning Ministry Secretary Dr P B Jayasundera, on behalf of the Sri Lanka Government Saudi Fund for Development Vice Chairman and Managing Director Engineer Yousef I Al-Bassan on behalf of the Government of Kingdom of Saudi Arabia.

Saudi Arabia Ambassador in Sri Lanka Abdul Aziz Abdul Rahman Al Jammaz, participated at the signing ceremony.