The Senate said China Development Bank (CDB) has taken over the financing of the project following the withdrawal of the China Exim Bank.
The Senate on Tuesday announced a new financier for the Kaduna-Kano railway modernisation project.
The former financier, the China Exim Bank, backed off the project making way for the China Development Bank (CDB) to take over.
To this effect, the Senate harmonised the terms of the 2016-2018 federal government's external borrowing plan for the project.
The resolution was a sequel to a motion sponsored by Sadiq Umar (APC-Kwara).
Presenting the motion, Mr Umar said the National Assembly approved a 22.8 billion-dollar loan for the modernisation of the Kaduna-Kano railway project in 2020.
He recalled that the National Assembly approved the loan under the 2016-2018 Medium Term External Borrowing (Rolling) plan.
The lawmaker also recalled the communication from the Federal Ministry of Finance requesting the approval of modifications to the financing proposal for the Nigerian Railway Modernisation Project (Kaduna-Kano segment).
"This was occasioned by the COVID-19 pandemic whereof China Exim Bank withdrew its support to finance the project," he said.
He added that: "to secure funds for the project, the contractor, the Chinese Construction Engineering Company (CCEC) Nigeria Ltd., and the Federal Ministry of Transportation, engaged the CDB as the new financier for 973.5 million dollars."
Contributing to the debate on the motion, Jibrin Isa (APC-Kogi), noted that there was a wide gap between the initial 22.7 billion dollars and the 973.5 million dollars.
He queried whether any disbursement was made out of the initial 22.7 billion dollars.
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Mr Isa advised that going forward, "we need to be very careful about the core structures of these loans."
In his intervention, Chairman, Senate Committee on Local and Foreign Debts, Clifford Ordia (PDP-Edo Central), gave clarification on the loan.
He said: "The submission of 22.7 billion dollars was in respect of five projects under the 2016-2018 external borrowing plan.
"Incidentally some of the other projects were approved apart from the project that has to do with the Kaduna-Kano segment.
"The financier declined to finance the project, so the CCEC Nigeria Ltd., in collaboration with the Federal Ministry of Transportation had to look for a contractor to finance the segment of the rolling plan."
In his remarks, Senate President, Ahmad Lawan, explained: "This issue started in 2018, but we approved it in 2020.
"We are not talking about the approval of the loan; it is the financier that backed out and there is now another financier," he said.
