Win-win Metro deal: Andhra gets payment

Over the 35 years concession period of the project, Maytas will pay the state government Rs 30,311 crore as a payback: Rs 11 crore on signing of the agreement, Rs 50 crore on achieveing financial closure, Rs 200 crore in the fourth year, Rs 100 crore a year from seventh to ninth year and, Rs 1,750 crore from 18th to 34th year.

Though it is a win-win situation, Maytas has the 8216;real8217; catch. It hopes to generate its revenues by developing prime real estate and leasing space for commercial use along the elevated project. The three metro rail lines pass through areas where real estate prices are the highest in the state. Here, Maytas plans to develop shopping malls, multiplexes, residential apartments, office spaces within the applicable laws, and give them on lease.

CM Reddy says the agreement is the best in the world, 8220;In this case, the developer is not taking any grant from the Government and instead they are paying the state Rs 30,311 crore over the concession period of 35 years before transfering the metro rail back to the State. The govt has a share in the project and can deter the company from doing anything against public interest.8221;