The railway ministry, in a bid to start work at the earliest on the proposed freight corridor, being sponsored by the Japanese government, has sought early finalisation of the feasibility report.

Though the feasibility report, work on which began in early 2005 by Japanese company Jica, is expected to take two years, the ministry wants at least part of the Rs 22,000 crore loan amount for the first phase to come through so that work can begin.

The total project is expected to cost Rs 60,000 crore for which the feasibility report from the Indian side is being conducted by Rites. This report is expected to come out by December.

The Japanese government had told the Indian government that it would be completing the study in three years, as that is a normal timespan for a project of such magnitude.

But after the request from the Railway ministry, it was mutually decided that the report would be completed in two years.

However, Railway Board chairman JP Batra have again requested Jica to complete its report within 18 months, as they want to start the project by early 2006.

Significantly, the Railway ministry has proposed that work on the project can start simultaneously while the feasibility reports are being prepared.

Japanese assistance of Rs 22,000 crore would meet 30% of the total project cost.

This would be a tied loan (wherein there is no possibility of global bidding) and Japan would be the main facilitator of the project, while the sub-contractors could be from any other country.

The loan would carry 4% interest with a 40-year repayment period and 10 years' grace period. It would be mainly for the Delhi-Mumbai corridor, which is the first phase of the project.