The New Zealand Government is proceeding with plans for a light rail running from Wellington Station to Island Bay and a new tunnel as its preferred option to revamp the city’s transport infrastructure.

A new four-lane tunnel will be constructed through Mt Victoria for public transport. The existing tunnel will be converted to be used for walking and cycling.

The project will also include enhancements to ease traffic flow at the Basin Reserve.

With an investment of NZD$7.4bn ($4.6bn), the Let’s Get Wellington Moving (LGWM) project will cover the construction of a light rail from downtown Wellington to the south coast and the airport on the east.

New Zealand Finance Minister Grant Robertson said: “The southern light rail option is our preferred choice for Wellington because of the significant potential it offers for new housing and neighbourhood growth.

“By 2050, we’re expecting up to 80,000 more people to be living within the city limits, and 25% more people coming into the central city each workday from across the region.”

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Work will begin on a detailed business case upon the agreement of the LGWM project’s partners.

The business case would also weigh the option of a rapid bus network along the light rail route.

With construction slated to begin in 2028, the project is anticipated to complete between ten to 15 years, stated Bloomberg.

The project builds on the ongoing transport projects across the city such as an overhaul of the Golden Mile, the construction of a roundabout on Aotea Quay, as well as enhancing safety on Thorndon Quay and Hutt Road.