Public Investment Board (PIB), a wing of the Finance Ministry, has approved three corridors of phase IV of Delhi Metro with certain conditions that include Delhi Metro will have to bear operational losses of phase IV.
After the PIB nod, the proposal is likely to be cleared by the Narendra Modi Government’s last Cabinet meeting before the Lok Sabha elections. The Centre is keen to remove all hurdles for starting Metro phase IV construction as early as possible. And Delhi Metro has said it is ready to start the work soon after getting the Government’s nod.
Sources in the Finance Ministry said the Centre will keep its stake at 20 per cent and would not fund Delhi Metro phase IV project if Delhi Metro fails to bear operational losses or cost escalation due to any reasons. In case Delhi Metro fails to bear the loss, if any, the Delhi Government will have to do it, said the sources. The Ministry has also made it clear that Delhi Metro will have to service the interest payment during the construction period. Delhi Metro has also been advised to generate funds from other resources, including issuance of metro bonds.
Sources said the Japan International Cooperation Agency (JICA) has reduced soft loan amount for the six corridors of Delhi Metro phase IV projects. The Delhi Government has proposed that Delhi and Centre should bear 50-50 share of the operational losses.
In foreign loans, there is a risk of currency loss due to fluctuations in foreign exchange market. Till now the Centre and the State Government have been sharing the currency losses equally. The 50-50 operational losses was the norm for Delhi Metro’s first and second phases but it was changed for the third phase.
According to sources, three corridors of Delhi Metro phase IV include Aerocity to Tuglaqabad (20.20 km); RK Ashram to Janakpur (28.93 km) and Mukundpur to Maujpur (12.54 km). The total cost of three corridor is expected to be around Rs 30,000 crore. There are six corridors in phase IV with estimated cost of around Rs 46,845 crore.
The Delhi Metro had submitted the first detailed project report (DPR) of Phase IV in 2014. However, approval from the Government was pending for over four years due to various issues, including finances. The Delhi Metro’s Phase-IV is also slated to connect Uttar Pradesh and Haryana with the main hubs of Delhi.