The loan, which was approved by the World Bank in August, brings the total amount of credit from the Bretton Woods institution to Sh314.9 billion.
“The funds are provided on concessional terms, at an interest rate of 0.75 per cent with a grace period of 10 years and repayment period of 30 years,” Finance minister Njeru Githae said.
Donors usually require that governments provide their contributions, known as partner funds, into projects of such magnitude.
The construction of the double decker road is scheduled to begin as soon as the World Bank releases the money since the project is already behind schedule.
The highway project, which is estimated to cost Sh17 billion, is part of the Kenya National Highway Authority’s plan to improve the thoroughfare from the Jomo Kenyatta International Airport to Rironi in effort to ease traffic congestion in Nairobi and its environs.
“The project will cover 12 km between St. James Hospital and James Gichuru; and will involve construction of an elevated road,” said the Authority’s director general Meshack Kidenda in an earlier interview.
The double decker road will begin some metres from the Haile Selassie roundabout and will run past the existing University Way roundabout.
Part of the loan will also be used to expand Waiyaki Way to Rironi to create an extra lane for commuter buses – laying the foundation for the development of a bus-rapid transit system.
The fund will also be used to construct by-passes in Kisumu and Meru aimed at easing traffic congestion in the two counties.