New Delhi, Jan 8 (IANS): The Centre will provide viability gap funding to build the 'North East Gas Grid' project in the northeast, the Cabinet Committee on Economic Affairs said on Wednesday.

The project is being implemented by the state-run Indradhanush Gas Grid which was incorporated in 2018.

According to CCEA, the project will be provided with viability gap funding at 60 per cent of the estimated cost of Rs 9,265 crore, including interest during construction period.

"Quantum of VGF would be capped at 60 per cent of estimated project cost and would not be linked with upward capital cost variation," the CCEA said in a statement.

"The capital grant will provide natural gas supplies to various types of consumers viz. Industrial, PNG (Domestic), CNG (Transport) etc. and would immensely help in substituting the liquid fuels."

The pipeline has a total length of 1,656 kms and a tentative project cost of Rs 9,265 crore.

As per the plan, the gas pipeline grid would be developed in eight states of the northeastern region, namely Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura.