Economy

Treasury allocates Sh1.5bn more for Naivasha-Malaba railway line

rail

Chinese workers inspect the Nairobi-Naivasha SGR line. FILE PHOTO | NMG

The upgrade of the old railway line from Naivasha to Malaba has received a major boost after the State allocated Sh1.5 billion more to complete works on the project.

Treasury Cabinet Secretary Ukur Yatani, in a revised spending plan tabled in Parliament on Tuesday, said the money will go towards finishing works on the project that started in 2020.

“Sh1.5 billion will go towards rehabilitation of Naivasha –Malaba meter gauge rail,” said Mr Yatani. The project is 85 percent complete.

The government opted to fund the revamp of the metre gauge railway (MGR) line to Malaba with an initial budget of Sh3.5 billion.

It dropped a private financier and the use of the Chinese contractor who had quoted over Sh50 billion to upgrade the line and link it to the Mombasa-Naivasha SGR line.

Transport Secretary James Macharia told the Business Daily in the past that the Public-Private Partnership (PPP) arrangement was taking too long, prompting the government to drop it and seek a cheaper financing model.

“Government will fund it and the estimated cost is about Sh3.5 billion, but after proper documentation, this could be plus or minus,” Mr Macharia then.

Sources familiar with the earlier PPP plan said that a quotation for the upgrade by a Chinese contractor had surpassed the envisaged budget by more than three times, sending the government back to the drawing board.

The government had estimated that revamping the MGR line to Malaba would cost Sh21 billion.

The state is adding more funding for the rehabilitation of the project at a time Kenya Railways Corporation (KRC) has already started trial runs for freight train services to offer seamless cargo transfer at the Naivasha Inland Container Depot from the standard gauge railway (SGR) to the old meter-gauge railway (MGR).

The trial of 22 containers to be ferried to Kampala through Malaba using MGR started this week before full operations can resume in March this year.

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