HYDERABAD: While Hyderabad Metro is the only project in the country, after Delhi Metro, to be making profits in terms of revenue, HMRL’s private partner L&T is paying a massive interest of Rs 1,300 crore per annum. Therefore, the company’s goal to reach break even point within four to five years of commissioning has been extended to at least seven years.
Speaking to media persons, NVS Reddy, MD, Hyderabad Metro Rail Limited said, "The original cost of the Metro rail system was Rs 14,132 crore. Out of this, the Central government’s grant was Rs 1,458 crore. Our private partner L&T invested Rs 12,674 crore. The government of Telangana provided land acquisition of close to 3000 properties worth Rs 2,500 crore. This included not just acquisition, but also projects such as road widening."
He further explained, "Most of the Metro projects in the country are government projects and therefore loans have been provided at a rate of 1-1.5 per cent interest. However, in Hyderabad’s PPP model, L&T is paying an interest of 10 per cent resulting in Rs 1300 crore per annum. This has led to the cost of the project rising every year. The total cost of the project has reached Rs 21,000 crore. The plan for L&T was to earn revenue from three different sources - 50 per cent from passenger fares, 45 per cent from property development such as malls and five per cent from advertisements. L&T is currently earning Rs 480 crore revenue per annum - Rs 30 crore per month from passenger fares and Rs 10 crore per month from property development and advertisements."
However, according to Reddy, L&T has been provided with six million sq ft for commercial exploitation purposes, of which they have been able to utilise 1.3 million sq ft. "Hyderabad Metro’s vision was to provide commercial exploitation through engineering innovation," said Reddy.
NVS Reddy's expertise sought by TTD officials
Officials from TTD have reportedly requested NVS Reddy to provide his expertise on a transportation plan to connect Tirupati city to the Lord Venkateswara temple inTirumala, after ropeway plans were shelved. The MD was recently on a three-day trip to the temple town. He is awaiting further communicaton