Hyderabad Metro: Delay in project lead to cost overrun of Rs2,600 crores

Anushka Khare Posted on: 2019-05-14 08:01:11 Viewer: 1,192 Comments: 0 Country: India City: Hyderabad

Hyderabad Metro: Delay in project lead to cost overrun of Rs2,600 crores

Hyderabad (Urban Transport News): The Hyderabad Metro rail projects has led to the cost escalation of about Rs.2,600 crores due to lack of last mile connectivity, commissioning of the two operating routes in stages, and suspension of work on the Old City route between Mahatma Gandhi Bus Station and Falaknuma. The total project cost of the Hyderabad Metro rail project was earlier estimated to Rs.16,571 crores which are now escalated almost by 16% i.e. Rs.18,971 crores due to various delays in commissioning of the entire routes.

The completion date of the project is extended to July 2019. At present only one metro corridor is functioning in full and monetization of the Transit Oriented Development (TOD) or commercial usage at stations has led to the escalation. Sources said that L&T Metro Rail (Hyderabad) Limited has infused Rs.2,427 crore and took loans of Rs.10,760 crore.

According to the current progress of Hyderabad Metro, 28 km stretch between Nagole and HiTec City/Raidurg is on the completion stage while another corridor between Jubilee Bus Station and MGBS (9 km) is yet to be made operational. According to a recent report published by India Ratings & Research, all these, including non-commencement of the entire stretches, has led to the metro rail getting lesser traffic than envisaged forcing the parent company L&T to shore up to Rs.818 crore for the project.

The report said that metro rail projects are more capital intensive than other transportation costs and delays are inevitable, although the project has a strong economic rationale, the actual usage of metro rail in terms of ridership and growth will become clear only after the entire Hyderabad metro project is operational. Sources said that continuous ‘suspense’ over the Old City route from MGBS to Falaknuma is a major factor considering it passes through thickly populated areas and commissioning of this stretch will reap the envisaged benefits of the inter-modal rapid transit system.





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