Lucknow metro gets a European boost; EIB approves loan worth $512 million

India would get a loan of 450 million euros ($512 million) from the European Investment Bank, to finance the construction of Lucknow's first 23 km-long metro rail line and purchase new trains.

The agreement about the loan was signed in Brussels on Wednesday, when PM Modi was there to take part in the 13th EU-India summit.

This is the largest Indian project financed by European Union's official bank, which also serves as the world's largest international public bank. EIB and India’s relations go back to more than 20 years ago.

The long-term loan is expected to cover half of the total project cost for the Lucknow Metro line, which is to be constructed as the first part of a broader metro network that has been planned for UP’s capital city. As of now, 10% people in Lucknow use public transport, which would be increased to an estimated 27% once the metro line becomes operational.

Werner Hoyer, president of EIB, said that the bank would expand its support for long-term investments in India while unveiling plans to open a regional representation for South Asia in New Delhi by 2016 end.

"The first metro line in Lucknow is a flagship project not only for Uttar Pradesh and India, but also for the bank's strengthened global commitment to support transformational investment," Hoyer said.

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