Friday, Nov 28, 2014

Metro runs ahead of Central fund

Mmetro-480 Work on the 11.4-km Versova-Andheri-Ghatkopar Metro project had started in February 2008. (Indian Express)
Written by Manasi Phadke | Mumbai | Posted: March 3, 2014 2:10 am

Even as work on the Versova-Andheri-Ghatkopar Metro is complete and the city’s development authority is preparing to commission the line in the next month, the Union government has only recently sanctioned for disbursal the last tranche of its contribution towards the project.

The funds, over a third of the Centre’s total contribution to the viability gap funding, were sanctioned last month after inordinate delays. The Union government had committed viability gap funding, which refers to the public sector’s contribution in a public private partnership project, of Rs 471 crore, or 20 percent of the project’s original cost of Rs 2,356 crore.

Of this, the last tranche that has recently been approved for release is Rs 160 crore. The amount had been pending since 2012. As per a presentation by MMRDA officials to the Ministry of Urban Development in June 2012, the Union government had released only Rs 310.5 crore of its share till that time.

UPS Madan, metropolitan commissioner, MMRDA, said, “The delay was because of procedural issues. In February or March last year, the UD ministry had recommended the funds for disbursement to the Department of Economic Affairs. But it could not come up in the budget last year because they had some queries.”

The total viability gap funding for the project was Rs 650 crore — Rs 471 crore from the Centre and Rs 179 crore as the state government’s or MMRDA’s contribution. Madan added that the delay in release of the viability gap funding from the Centre had not impacted the project much, as MMRDA was providing additional funds.

Reliance Infrastructure-led Mumbai Metro One Pvt Ltd (MMOPL), the special purpose vehicle for the execution of the project, declined  to comment.

Work on the 11.4-km project had started in February 2008. As per the concession agreement signed with MMOPL, the original deadline was March 2012, while MMOPL officials were optimistic about completing the project even earlier. The project was delayed mainly due to land acquisition hurdles and delays in clearances. The Metro corridor is now in its final stages of receiving a safety certification.

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