CHENNAI: Chennai Metro Rail Limited (CMRL) may not have defaulted payment of loans from either external or internal funding agencies, but its financial health is not steady. Under cash deficit, it is unable to pay interest and repay the loan, according to a report prepared by the 17th Lok Sabha Standing committee on Housing and Urban Affairs (2021-22). Currently, CMRL makes the debt payment with the State government’s help.
The report states that low ridership, delay in project completion, shortfall in expected non-farebox collection, and interest on JICA loan were reasons for CMRL’s losses. While ridership is increasing, it was still about half of what was predicted in the Detailed Project Report (DPR). Currently, average daily ridership was around 1.8 lakh to 2 lakh while the one predicted in the DPR was 4.33 lakh (2020-21).
According to the report, payment toward the original amount of a loan owed by CMRL is Rs 658.36 crore, of which only Rs 32.07 crore had been paid. “Chennai Metro continues to put its best effort to augment its revenue and reduce the costs wherever possible to close this deficit,” the report adds.
MA Siddique, Managing Director (MD) of CMRL, who took charge recently, told TNIE that CMRL would reach break-even point in five years, with the help of additional network to be added in the next three years. The metro rail is addressing such issues as first-and-last-mile. “There could be a huge surge in ridership like what happened in New Delhi once additional lines are added; this could help the metro tremendously,” he said.
Inaugurated in 2015 with just the Koyambedu-St Thomas Mount line, CMRL’s different stretches under phase-I and phase-I extension were commissioned in different time periods. The final stage of phase-1 was commissioned in February 2019 and that of phase-I extension in February 2021, at a total cost of over Rs 20,000 crore.
Sivasubramaniam Jayaraman, National Lead - Electric Mobility and Transport Systems, Senior Programme Manager, Institute for Transportation and Development Policy (ITDP), told TNIE that metro rail offered the most reliable, fast, and comfortable journey experience compared with other services, but it cames with a huge investment.
“As per the ‘People Near Transit’ study conducted by ITDP India in Chennai, only 9% of people have access to metro rail services within a walking distance of 1km. “It’s high time we improved accessibility to the station and provided safe and affordable last-mile options,” he said.Prof Krishna Raj of Institute for Social and Economic Change said metro rail projects investments were huge and they should be taken up after conducting a study on accessibility and affordability.
Metro rails drain govt of funds
A recent report by PRS Legislative Research said investment in metro rail projects formed one of the biggest expenditures incurred by the Union ministry of urban transport. It resulted in inadequate funds for other schemes. In 2022-23, capital expenditure on metro projects was estimated to be 87% of the ministry’s total capital expenditure