Kampala — The European Union (EU) has given Uganda government a grant of more than Shs90 billion for the rehabilitation of 375km Tororo-Gulu railway line that ceased operations more than a decade ago.
Speaking during the signing of the grant agreement at the Ministry of Finance headquarters in Kampala yesterday, Ambassador Attilio Pacifici, the EU head of delegation to Uganda, said: "Uganda on her side will provide Shs57 billion."
Ambassador Pacifici said the money will finance the physical rehabilitation of the line, supervision of the works, capacity building to the Uganda Railway Corporation, and compensation of the Project Affected Persons.
"With this project, the EU continues to support Uganda's economy through the promotion of a multimodal, safe and efficient transport sector.
We will in particular support the efforts of government to shift cargo from roads to more environmentally friendly - or greener- transport modes such as railways and waterways," he said.
Ambassador Pacifici said the project is part of the EU's efforts to help government develop northern Uganda and also complements well the EU humanitarian assistance to refugees and support to host communities provided under the EU Emergency Trust Fund.
The railway is to complement the construction of Gulu logistics hub done in a partnership with Uganda government and DFID Trademark East Africa to facilitate trade by reducing import and export transportation costs.
This newspaper also understands that there is a budget constraint.
Finance minister Matia Kasaija said from 2006, Uganda railways was conceded to Rift Valley Railways (RVR), a private operator, mainly for freight transport services.
"The move to bring a private player on board was hinged on the need to tap into the expertise, innovation, efficiency and motivation that the private sector can deliver under the railways subsector. This never happened," he said.
