Costs v/s Benefits of the SilverLine Project

T.R. Anand
Finance Expert

The SilverLine project is one of the most prestigious rail projects in India involving the construction and operation of semi high-speed trains. The SilverLine project shall cover 530.60 kilometers from Thiruvananthapuram to Kasaragod.

The SilverLine project would facilitate fast & convenient travel across most of the major cities in the State within a maximum time of 4 hours. The SilverLine project is a SPV (Special Purpose Vehicle) under K-Rail, which is a Joint Venture between the Ministry of Railways and the Government of Kerala.

The SilverLine project is estimated to be completed by 2025 at an estimated completion cost of INR 63,941 crores inclusive of land cost. Ministry of Railways and Government of Kerala shall contribute equity capital amounting to INR 6,378 crores. Besides the same, they shall also extend interest-free loans amounting to 19,611 crores, to ensure that the project is profitable at the earliest.

The prestigious SilverLine project will also source loan funds amounting to INR 33,700 crores from bilateral/multilateral funding institutions. These funding institutions provide financial support to Government projects of importance at a nominal rate of interest.

Besides the above, there are several social benefits from the SilverLine project. This project shall contribute to the diversion of a high proportion of current private traffic from Road to Rail and serve part of the growing passenger traffic and goods demand in Kerala. As a result, there will be a reduction in the number of buses, passenger cars and other vehicles carrying passengers and goods on Kerala roads. This will lead to savings in travel time for passengers and goods moved by SilverLine trains due to high speed. The residual traffic left on the road will also be benefited due to reduced congestion.

This would result in enormous savings to the residents in terms of passenger time costs. Similarly, enormous benefits shall be made available to the residents through a reduction in vehicle operating costs as this mode of travel is more convenient and economical.

Further, due to reduced road traffic, there shall be reduced pollution levels improving the quality of life of the residents. Also, the reduction in road traffic will result in lesser road accidents.

The project will also offer tremendous employment opportunities in the State, both during and after the construction. Many industries and workers will be benefited directly or indirectly due to the project. In particular, tourism, real estate and logistics industries shall be the biggest beneficiaries.

Latest technologies shall be used in the construction of the SilverLine project. This would help in upgrading the skills of the residents and making them internationally competitive. Several offices are planned to be developed in and around the stations which would ensure convenient travel to the officers and staff of these organisations.

To conclude, the SilverLine Project shall not only improve the image of the State but also provide tremendous benefits to the residents and the capital contributors.


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