The Nanjangud-Nilambur line, which was included in the 2016-17 Railway Budget, is 236 km long and estimated to cost Rs. 6,000 crore.
But E. Sreedharan, the principal advisor of the Delhi Metro Rail Corporation, has suggested an alternative alignment which will reduce the cost to Rs. 3,500 crore and the length to 155 km.
The funding is to be raised entirely from extra-budgetary resources and sources in the Railways say the final line survey may be taken by the Kerala government. A previous survey, conducted by the Railways and submitted in 2013, had put a question mark on the economic viability of the project as it was projected to generate a negative internal rate of return of 0.895 per cent.