CHENNAI: The state government will take control of the Mass Rapid Transit System (MRTS) stations and non-core operations within 90 days after signing of a memorandum of understanding (MoU), under a revised agreement with the centre. The MoU also allows the state to reclaim over 120 hectares of land provided for the project at no cost.
However, key railway-owned parcels at joint stations such as Chennai Beach, Fort and Park Town will be leased to the state at 1.5% of market value with annual escalation. In cases where land acquisition costs were shared, Tamil Nadu will reimburse Railways’ one-third share along with interest linked to government bond yields, according to official sources.
The revised MoU, reworked after a recent empowered committee meeting, sets out a phased transfer of assets, operations and maintenance from Southern Railway, marking a decisive step towards ending decades of split control, sources said.
Under the framework, the state will deploy its own staff for ticketing, security and station management within three months of signing the agreement, with railways withdrawing from these functions. Train operations, including crew, rolling stock and maintenance, will remain with Southern Railway for up to two years during a transition period.
Fare revenue during this phase will be collected by the state but passed on to railway. A key hurdle-valuation of MRTS assets-has been addressed through a depreciated cost approach.
TN will compensate railways for Phase I infrastructure, which was fully funded by the centre, and for the railways’ share in Phase II and its extension, where project costs were split in a 1:2 ratio between the centre and the state.
