Delhi Metro Phase IV projects are likely to face fund crunch as the Delhi Government has refused to reimburse 50 per cent of Central taxes paid by the Delhi Metro Rail Corporation (DMRC) anymore. The AAP Government has taken this decision after failing to convince the Centre to raise State’s share of the Central taxes. It has remained unchanged for the last 17 years.
In a missive to the Delhi Metro Rail Corporation, the State Government said, “Since the Government of NCT Delhi, being a Union Territory, is not getting a proportionate revenue share of Central taxes from the Government of India as compared to other States it shall not reimburse 50 per cent of the Central taxes.”
The total amount of Central taxes liability for six Delhi Metro corridors under Phase IV is expected to be around Rs3,000 crore. With the Delhi Government announcing that it will no longer reimburse 50 per cent of the Central taxes, there will be a shortfall of Rs1,500 crore. This could delay the project and may lead to fresh confrontation between the Delhi Government and the Centre on the issue of financing of the Metro project.
The fourth phase that was approved by the Delhi Cabinet last month will have a total length of around 103 km and will be completed in six years at a cost of around Rs55,208 crore.
The DMRC, set up in May 1995 under the Indian Companies Act, is an equal equity joint venture between the Government of India and the Delhi Government. The latter bears 50 per cent cost towards equity, subordinate debt for land and subordinate debt for reimbursement of Central taxes.
The Delhi Government also reimburses the Delhi Value Added Tax (DVAT) paid by the DMRC as well Central taxes on rolling stocks and other purchases by Delhi Metro.
The State Government gets Rs 325 crore annually as its share of the Central taxes and has been demanding its revision for the last 17 years.
The Delhi Government has claimed that so far, it has followed the procedure of 100 per cent reimbursement to the DMRC.
“Since the proposed projection of Rs 500 crore as property development is on the lower side, Delhi Metro should try to achieve a higher projection as property development. Delhi Metro will explore the possibility to work out the completion cost of all the six corridors of phase IV of Delhi MRTS project based on an escalation factor of 5 per cent to 6 per cent instead of 7.50 per cent,” the letter said.
Officials of Ministry of Urban Development said the Delhi Government should separately take up the matter with the Central Government. According to officials, the third phase of Delhi Metro has already been delayed.
The new lines of Delhi Metro Phase IV will add 8.5 lakh passengers every day to the ridership.
Phase-IV of Delhi Metro will comprise a 67 km elevated road and would add 79 stations to the network out of which 50 will be elevated. The six new lines which connect outer Delhi and Aero City include Rithala-Bawana-Narela, Janakpuri West-RK Ashram, Mukundpur-Maujpur, Inderlok-Indraprastha, lajpat Nagar-Saket G-block and Aero City-Tughlakabad.
The total length of the Rithala-Bawana-Narela line will be 21.73 km and it will have 16 stations while the 12.54 km Mukundpur-Maujpur line will have six stations, all elevated.
The Janakpuri West-RK Ashram stretch will be of 28.92 km with 18 elevated and seven underground stations on the line. The length of Inderlok-Indraprastha line will be 12.58 km and will have ten stations that will all be underground.
The 20.20 km Aero City-Tughlakabad line will have ten underground and five elevated stations, while the lajpat Nagar-Saket G-block stretch will be 7.96-km-long and have one underground and five elevated stations, while one station will be at grade (on the ground level). The capital cost of Rithala-Bawana-Narela line will be Rs 7,836 crore and for Mukundpur-Maujpur line, it will be Rs 4,476 crore.
The capital cost of Janakpuri West-RK Ashram stretch will be Rs 14,522 crore while for Inderlok-Indraprastha line, it will be Rs 8,421 crore. Similarly the capital cost of Aero City-Tughlakabad line will be Rs 11,330 crore while for lajpat Nagar-Saket G-block stretch, it will be Rs 3,018 crore.