The central government will bear 20 percent of the total cost of the proposed metro rail project for Hyderabad, Andhra Pradesh Chief Minister Y.S. Rajasekhara Reddy said here Thursday.

"We have reached an arrangement with the central government Wednesday wherein it has agreed to fund 20 percent of the total cost," Reddy said while addressing a meeting on sustainable partnerships in infrastructure here.

The chief minister, however, did not elaborate.

His announcement came in the presence of Karnataka Chief Minister N. Dharam Singh, who had recently said his government must make all efforts to implement the metro rail project as "Hyderabad and Chennai were waiting to grab it".

Singh later told reporters that the Planning Commission had already approved the metro project for Bangalore.

The Andhra Pradesh government plans to take up the project at an estimated cost of Rs.43.92 billion ($1 billion). The state and central governments are likely to chip in 20 percent each, while the rest of the money could be tapped from the market.

Reddy announced that Prime Minister Manmohan Singh would soon lay the foundation stone of the eight-lane 160-km expressway around Hyderabad.

While reiterating his commitment to build world-class infrastructure in the state, Reddy said a knowledge corridor over 20,000 acres of land would come up near Hyderabad for IT, IT enabled services, housing and banking sectors.