Court stays works on Hyderabad Metro Rail corridor

Reprimands government for realigning the route without consulting the public

Coming down heavily on the state government and the Hyderabad Metro Rail Limited (HMRL), the Andhra Pradesh High Court on March 15, stayed all works on a stretch of corridor three of the project. The court observed that the metro rail project was kept away from public scrutiny, and the government was violating its own laws. HMRL, a public enterprise, is executing a mega Metro Rail project in the state capital under public-private partnership (PPP) considered one of the biggest in the country.

Cost goes up

	Even before the work began, the cost has more than doubled in three years during 2005-2008 from about Rs 6,000 crore to Rs 12,000 crore. In 2008, the metro rail authorities claimed in the high court that the delay will cause an additional expenditure of Rs 3.2 crore per day. Accordingly the project cost increased by Rs 2,179 crore between September 2008 and September 2010. When the cost of Rs 1,980 crore that the government wants to spend on land acquisition and compensation is added, the total cost of the project rises to Rs 16,496 crore from Rs 12,132 crore. This is likely to further increase by at least 30 per cent by the time the project is complete. The total project cost may thus cross Rs 18,000 crore. (Source: CBPTH report)

Largest infrastructure project

Agreement favours L&T

	A 2010 report by Ramachandraiah pointed out a glaring and blatant pro-private party clause in the concession agreement. The clause allowed extension of lease period if the actual traffic falls short of the estimated figures. For example, if the actual traffic falls short by one per cent of the estimated figures, the concession period can be extended by 1.5 percent of the lease period (35 years) to a maximum of 20 per cent (seven years). The estimated traffic figure by the authorities for October 1, 2021 is 2.75 crore passenger kilometres which comes to around 2.67 million passengers per day. Going by the logic, the estimated traffic after three years should be higher but the estimated traffic figure for 2024 is 2.2 million. The study points out the actual traffic for a particular date shall be derived by traffic sampling which should be done one year before for a continuous period of seven days during anytime within 15 days prior to the specified date and the average will be estimated as the actual figure. The study says there is no scientific basis for estimating these traffic figures. “It is a well-known fact that even after seven years the Delhi metro is not carrying even 30 per cent of the projected ridership. Are the government authorities so innocent that they are not aware of these issues,” asks the report. The lease period of 35 years will automatically be extended to 41 years with this clause. Besides, there is normal renewal of 25 years. “For about 67-70 years the city’s transport destiny will be in the hands of a private company,” states the report.