State’s nod to Urban Transport Fund forrepaying debt of Nagpur Metro project
| Date :15-Nov-2022 |
Staff Reporter
Maharashtra Government has put its stamp of approval on providing interest-free secondary loan of Rs 622 crore to Maharashtra Metro Rail Corporation Limited (MMRCL). A notification was issued by Urban Development Department (UDD) on November 14, 2022, thereby clarifying the doubts as to nature of statutory loan. The loan is meant for payment of tax of Rs 441 crore as part of 50 per cent equity contribution of Central Government and Rs 181 crore of State’s share. The said interest component was given nod as State gave revised estimate of Rs 9,279.06 crore for the first phase of Nagpur Metro that spans 38.215 kms.
The ballooning of cost is solely due to delay in completion of projects that in turn resulted in volatile appreciation in forex, as loans from two foreign agencies account for 50 per cent of capital raised by Maharashtra Metro Rail Corporation Limited (MMRCL) for the project.
Original estimated cost for the project was pegged at Rs 8,680 crore and the difference post revision is nearly Rs 599.06 crore. In terms of per centage the upward revision is above 100 per cent and in long run Nagpurians are going to face an uphill task since MMRCL has to repay the external loan on its own.
Also the State has also given assent to amendment of original terms to allow operation of special head 'Urban Transport Fund' wherein funds generated from Nagpur Metro is going to be deposited. The money therein is going to be utilised for repayment of debt as well as meeting operation and maintenance expenses.
The project was approved in year 2014 but actual work started a year later. Though Maha Metro officials set a frantic pace of work, land acquisition issues dogged it, followed-by inability of Nagpur Municipal Corporation (NMC) and Nagpur Improvement Trust (NIT) to chip in their 5 per cent each equity share due to paucity of funds.
In between, Covid-19 erupted and it again cast a spell on the speed of the execution of the project and ongoing services had also to be suspended leading to further dip in revenue.
At present two rail routes of MMRCL are running, Lokmanya Nagar to Sitabuldi and Khapri to Sitabuldi, a total of 26.20 kms, while nod is awaited for remaining 12.15 kms of route from State Government.
The Central Government that is equal partner in the project has already given its approval to revised cost of project.
Also State also cleared another critical component wherein land acquired by Maha Metro for the first phase is freed from encumbrances. Different land parcels was used by Metro for erecting the corridor and mainly stations.
Through the notification the UDD has asked the departments whose land was acquired for the project to present their papers and present cost so that same would be adjusted in budget. UDD is going to undertake the exercise on its
own giving relief to Maha Metro.
Similarly, District Collector, Nagpur, has been asked to complete the process of transferring ownership of 421398.67 sq.mtrs of land owned by Maharashtra Airport Development Corporation (MADC) to special purpose vehicle MMRCL free of cost. In city, Nagpur Metro has acquired 3,28,284.37 sq.mtrs of Government land for the project.