Sri Lanka cuts Chinese financed ring road cost by 30-pct: ministry
COLOMBO (EconomyNext) – Sri Lanka will build a 4-lane ring road around the capital as planned by the last regime but the cost was slashed 30 percent by not constructing support structures that would allow it to be expanded to six lanes later, and reducing material costs the highways ministry said.
The government will still go ahead with a deal signed by the ousted Rajapaksa regime with Exim Bank of China to borrow 66.7 billion rupees, but 24 billion rupees in saved funds will be used for other road projects.
The Highways Ministry said a committee reviewed the Colombo Outer Circular Highway Phase 3 (OCH-3) project.
The road was to be expanded to six lanes 12 year later in 2027, with the required support structures to be built now.
Traffic had been forecasted to rise 14 percent a year from 2017 to 2022 and 10 percent from 2022 to 27.
But the ministry said the traffic projections have been "exaggerated" with new vehicle registration projected to increase only by 6 percent a year during the same period.
"The removal of the provision to expand to six (6) lanes will ensure a reduction in the cost of the construction of expensive structures such as the viaducts and embankments," the statement said.
"The committee is also of the opinion that the construction material, which was to be provided by the contractor, is between 20 percent 30 percent above market rate.
"Due to the diplomatic, legal and time constraints (it would take between 2-3 years for a new project to be initiated) the Minister has decided to go ahead with the project on a reduced scope."