Telangana to Take Over Hyderabad Metro
The state cabinet of Telangana is expected to approve a plan for the state government to take over the Hyderabad Metro. The move could lead to significant changes in the management and operation of the city's primary public transportation system.
- The takeover involves the Telangana state government absorbing approximately ₹13,000 crore in debt and paying a one-time settlement of around ₹2,000 crore to the current operator, Larsen & Toubro (L&T). - L&T, which holds a 90% stake in the project, requested to exit the venture citing significant financial distress, with accumulated losses reaching ₹6,600 crore. The company's financial situation was worsened by the COVID-19 pandemic and high-interest rates on loans. - The move from a Public-Private Partnership (PPP) to a government-owned model was prompted by L&T's refusal to be an equity partner in the proposed Phase II expansion, creating a deadlock for future development. - The Hyderabad Metro, once touted as the world's largest PPP in the metro rail sector, has seen its daily ridership drop from a peak of 5.5 lakh to around 4.8 lakh, impacting revenues. - Operations and maintenance of the metro are currently managed by the French company Keolis under a contract that runs until November 2026; the state government is likely to continue this arrangement post-takeover. - NVS Reddy, who led the Hyderabad Metro Rail project for 18 years as its Managing Director, was recently replaced by Sarfaraz Ahmad and has been appointed as an Advisor to the government on Urban Transport. - The takeover is seen as a critical step to facilitate the extensive Phase II expansion, which aims to add approximately 163 km to the network, connecting areas like the airport and the proposed Bharat Future City.
