Centre approves new Metro policy, focus on public-private partnership in projects

With a focus on compact urban development, cost reduction and multi-modal integration, Centre approved a new Metro Policy on Wednesday.

Published: 17th August 2017 12:10 AM  |   Last Updated: 17th August 2017 12:10 AM   |  A+A-

Image of Delhi metro train used for representational purpose.

By Express News Service

With a focus on compact urban development, cost reduction and multi-modal integration, Centre approved a new Metro Policy on Wednesday. The policy opens a window for private investments across a range of metro operations making public private partnership (PPP) component mandatory for availing central assistance for new metro projects. 

Speaking about the new policy which got a green signal by the union cabinet on Wednesday, a senior official of the ministry of housing and urban affairs said, “Metro projects are capital intensive so the new policy calls for greater private participation and innovative financing through transit oriented development (TOD). In the new policy, states have been told to explore the option of PPP for Metro projects.”

Moreover, the new policy has also focused more on last mile connectivity.

“Now, the states have been told to give details of connectivity from metro stations focusing on a catchment area of five kms. The project should contain details of availability of feeder services, non-motorised transport infrastructure like walking and cycling pathways etc. States, proposing new metro projects will be required to indicate in project report the proposals and investments that would be made for such services,” added the official.

The new policy says that the metro projects should be planned and executed with a longer future perspective as it is very capital intensive and has limited flexibility in design changes on completion of construction.  States will have to do a comparative analysis of alternate modes of transport including bus rapid transit system (BRTS), light rail transit, tramways etc before sending the proposal to Centre, added the official.

Setting up of Urban Metropolitan Transport Authority (UMTA) has been made mandatory which is to prepare Comprehensive Mobility Plans for cities for ensuring complete multi-modal integration for optimal utilization of capacities.

Now, the Centre will sanction the project only after rigorous assessment of new metro proposals. “There may be independent third party assessment by agencies to be identified by the Government like the Institute of Urban Transport,” added the official

Besides, the new policy also asks states to ensure the financial viability of metro projects by indicating in the project report the measures to be taken for commercial or property development at stations and on other urban land and for other means of maximum non-fare revenue generation through advertisements, lease of space etc.

New Metro rail policy

· People will be benefitted as the states will have to give details of last mile connectivity from metro stations focusing on a catchment area of five kms for approval of the project.

· It calls for greater private participation and innovative financing through transit oriented development (TOD).

· States will have to do a comparative analysis of alternate modes of transport including bus rapid transit system (BRTS), light rail transit, tramways etc before sending the proposal to Centre.

· States will have to set up Urban Metropolitan Transport Authority (UMTA) to prepare Comprehensive Mobility Plans for cities for ensuring complete multi-modal integration for optimal utilization of capacities.

Metro projects in India

· Currently, metro projects with a total length of 370  kms are operational in 8 cities including Delhi (217 kms), Bengaluru (42.30  kms), Kolkata (27.39 kms), Chennai (27.36 kms), Kochi (13.30 kms), Mumbai (Metro Line 1-11.40 km, Mono Rail Phase 1-9.0 km), Jaipur-9.00 kms and Gurugram (Rapid Metro-1.60 km).

· Metro projects with a total length of 595 kms in 13 cities including 10 new cities are at various stages of planning and appraisal. These are; Delhi Metro Phase IV- 103.93 km, Delhi & NCR-21.10 km, Vijayawada-26.03 km, Visakhapatnam-42.55 km, Bhopal-27.87 km, Indore-31.55 km, Kochi Metro Phase II-11.20 km, Greater Chandigarh Region Metro Project-37.56 km, Patna-27.88 km, Guwahati-61 km, Varanasi-29.24 km, Thiruvananthapuram & Kozhikode (Light Rail Transport)-35.12 km and Chennai Phase II-107.50 km.

The policy envisages private sector participation in Operation and maintenance (O&M) of metro services in following ways.

· Cost plus fee contract: Private operator is paid a monthly or annual payment for operation and maintenance. This can have a fixed and variable component depending on the quality of service. Operational and revenue risk is borne by the owner.

· Gross Cost Contract: Private operator is paid a fixed sum for the duration of the contract. Operator to bear the O&M risk while the owner bears the revenue risk.

· Net Cost Contract: Operator collects the complete revenue generated for the services provided. If revenue generation is below the O&M cost, the owner may agree to compensate.

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