The government on Friday signed the JPY17.4-billion ($130 million) Metro Rail Transit (MRT) Line 3 Rehabilitation Project (II) loan agreement with the Japan International Cooperation Agency (JICA).

The agreement was signed by Department of Finance (DOF) Secretary Benjamin Diokno and JICA chief representative in the Philippines Sakamoto Takema at the DOF office in Manila.

The rehabilitation includes provisions for capacity including rolling stock, rail tracks, signaling system, power supply system, overhead catenary system, communications system, and depot and station equipment.

In a statement, the Finance department said the supplemental loan for the MRT 3 was approved by the National Economic and Development Authority Board on Feb. 2, 2023.

It will be used to finance the increase in the total project cost amounting to PHP29.6 billion, following the additional scope of work submitted by the Department of Transportation.

These include integration and capacity expansion, complete rehabilitation, operation and maintenance concession dovetailing with the expiry of the Build-Lease-Transfer agreement in 2025, and addition and extension of maintenance works to account for the six-month period of community quarantine due to the pandemic.

The loan carries an interest rate of 0.10 percent per annum for non-consulting services and 0.01 percent per annum for consulting services, to be repaid in 40 years, inclusive of a 10-year grace period.

As of March 2023, Japan is the Philippines’ top official development assistance (ODA), with total ODA commitments at $10.4 billion, including loans and grants.

The DOF said loans amounting to JPY377 billion ($2.8 billion) were already signed with JICA within the first quarter of 2023.

Among these projects are the North-South Commuter Railway (NSCR) Project Phase 1 and 2 and the NSCR Extension Project (II). (PNA)