Payment under VGF still pending

While there is renewed hope of second phase of the Hyderabad Metro Rail (HMR) kicking off with the government allotting ₹1,000 crore in this year’s budget, the pending payment from the Centre under the Viability Gap Funding (VGF) continues to stick as a sore thumb. This is for the first phase of the project built by L&T Metro Rail Hyderabad (L&TMRH) across three routes under the Public, Private Partnership (PPP) mode.

The Centre had assured to give ₹1,458 crore or little more than 10% of the projected cost of ₹14,156 crore then and the money was being released in stages as per the construction progress in the seven years of construction for completing about 69.2 km – Red Line or Corridor One from L.B. Nagar to Miyapur, Blue Line or Corridor Three from Nagole to Raidurg and Green Line or Corridor Two – Jubilee Bus Station and Mahatma Gandhi Bus Station, Imlibun.

Centre had released ₹1,204 crore and the balance amount of ₹254 crore has not been sanctioned even after completion of the first phase of the project – save for extending the line beyond MGBS into the Old City till Falaknuma, as per the latest government report. Whether it is because of non-completion of this stretch or because there were issues with regard to the revision of the fare structure at the time of the launch by L&TMRH, the fact is funds were not released despite repeated reminders.

"The issue has been brought to the notice of Finance Minister Nirmala Sitharam too and many communications were sent with senior Minister K.T. Rama Rao personally taking up the matter, however, the remaining fund is yet to be released," disclosed senior officials, declining to be identified.

Telangna government had put in ₹ 2,730 crore into the first phase for road widening, properties acquisition, shift of utilities like water, power and sewer pipelines. L&TMRH had invested ₹18,103 crore and had already submitted that the project cost overrun has been to the tune of ₹3,756 crore, seeking appropriate relief – another pending decision, this time the onus is on TS.

The government has put the revenue loss due to shutdown of the metro rail service for about six months from March to September last year at ₹220 crore. L&TMRH has claimed a loss of ₹382.21 crore in 2019-20. The project was completed and opened in stages between Nov. 29, 2017 when Prime Minister Narendra Modi launched the inaugural stretch from Nagole to Miyapur via Ameerpet to the last mile between JBS-MGBS flagged off by Chief Minister K. Chandrasekhar Rao on Feb.8, 2020.

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