Chandigarh, Feb 2 (IANS): The Haryana government on Thursday announced that it plans to set up a Mass Rapid Transport System (MRTS) between Gurugram and Manesar.

The Haryana cabinet, which met under the chairmanship of Chief Minister Manohar Lal Khattar here on Thursday, approved the proposal of the Industries and Commerce department that the state government would stand guarantee for a loan of Rs 876 crore to be taken by Haryana State Industrial and Infrastructure Development Corporation (HSIIDC) from HUDCO to acquire 365 acres of land for the MRTS project.

"The project is of great strategic importance and Japan International Cooperation Agency (JICA) has committed in-principle to provide Rs 16,000 crore for the project," a Haryana government spokesman said here.

The provision for the project has also been made by the Department of Economic Affairs of the Union Ministry of Finance in its ruling plan.

The Gurugram to Manesar stretch of National Highway No 8 (NH-8) remains choked with traffic most of the time. The highway links Delhi with Jaipur.