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Rediff.com  » Business » Mumbai Metro: Cash shortfall of Rs 220 crore in 1st year

Mumbai Metro: Cash shortfall of Rs 220 crore in 1st year

October 26, 2015 08:48 IST

Mumbai Metro I. Photograph: Hitesh Harisinghani/Rediff.comThe company is expected to incur a loss of Rs 300 crore (Rs 3 billion) at the current fare slab of Rs 10 to Rs 40
Reliance Infrastructure arm Mumbai Metro One has said that in the first year of operations of the Mumbai Metro rail, the cash shortfall at the fare slab of Rs 10 to Rs 40 will be worth Rs 220 crore (Rs 2.2 billion).

However, the cash shortfall will reduce to Rs 100 crore (Rs 1 billion) at a fare slab of Rs  10 to Rs 110.

Further, MMOPL, which launched the operations on June 8 last year, stated it would incur a loss of Rs 300 crore (Rs 3 billion) a year at Rs 10-40 fare slab.

In its affidavit submitted in the Bombay High Court on a petition by Mumbai Metropolitan Region Development Authority, the company said although Mumbai is growing moderately, it has considered an increase of 12 per cent in one year against the National Highways Authority of India's traffic growth of four per cent per annum.

Besides, its employee cost is only Rs 57 crore (Rs 570 million) compared to Delhi Metro Rail Corporation’s Rs 332 crore (Rs 3.32 billion).

The company is expected to incur a loss of Rs 300 crore (Rs 3 billion) at the current fare slab of Rs 10 to Rs 40.

MMRDA has challenged the fare fixation committee’s recommendation to increase fare to Rs 110 for the 11.4-km Versova Andheri Ghatkopar metro corridor.

MMOPL has already taken a decision to extend the fare slab of Rs 10 to Rs 40 up to November 30 from October 31 by providing a relief to the commuters from a fare hike.

Simultaneously, MMOPL is pursuing with the state government a slew of sops including a one-time grant of Rs 1,000 crore (Rs 10 billion) to avoid fare hike.

With regard to traffic, MMOPL said at a ridership of 21,930 per km for the Versova Andheri Ghatkopar metro line is comparable to most of the dense metros in the world such as DMRC (13,087/km), Bengaluru (2,808/km), Seoul (21,33/km), Tokyo (27,915/km) and Beijing (15,249/km).

The company has pointed out that the traffic for BrihanMumbai Electric Supply & Transport, which runs bus service in Greater Mumbai, is showing a declining trend.

“The capacity to carry 1.1 million passengers a day was built to cater to the entire duration of 30 years of concession period.

"So far, the initial years up to 15 years, a very low utilisation does not mean the project has failed. It only means the capacity is being built up in a steady manner to cater to the entire need of the concession period.

"Even though MMRDA is the planning agency, it failed to appreciate such a critical angle of capacity building,” the company said.

Image: Mumbai Metro I. Photograph: Hitesh Harisinghani/Rediff.com

Sanjay Jog in Mumbai
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