For many who depend on public transport, the Metro became a welcome relief in Hyderabad city. But now the project is weighed down by heavy debts and urgently requires financial support to continue running.
Hyderabad Metro, which began in 2017, carries around 4.5 lakh commuters every day. Trouble started early. By 2020, the state government had to pay Rs 5000 crore to operator L&T, besides Rs 254 crore for viability gap funding.
L&T has struggled to meet daily maintenance costs through ticket sales. The company informed the state government and Centre that it is ready to sell its equity as part of an alternative arrangement.
The company said it can no longer maintain the Metro. If offered under a PPP model, it is willing to transfer control. Even a special purpose vehicle arrangement will be acceptable, according to L&T.
L&T has also written to the Central MAUD Minister, saying it cannot bear the financial burden. The Centre asked the state government for a detailed report on fare hike, maintenance challenges, and the incomplete first phase.
Hyderabad Metro holds the distinction of being the first built under a PPP model. Recently, Mumbai Metro Rail Corporation Limited was bailed out when RBI bought 4.61 acres of land for Rs 3472 crore. Observers now wait to see how Hyderabad Metro will be supported.
