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Centre, Delhi government face-off over Delhi Metro’s Phase 4 liabilities, profits
On Tuesday, Delhi Chief Minister Arvind Kejriwal tweeted his surprise that the Central government has put the onus of bearing the operating losses completely on the state along with repayment of the loan from the Japan International Cooperation Agency (JICA).
The Delhi government and the Centre have locked horns again over the financial liability of the Delhi Metro’s Phase IV, work on which has been delayed for over two years.
On Tuesday, Delhi Chief Minister Arvind Kejriwal tweeted his surprise that the Central government has put the onus of bearing the operating losses completely on the state along with repayment of the loan from the Japan International Cooperation Agency (JICA).
“I am surprised at this news. Centre and Delhi government hold 50:50 equity in Delhi Metro. Now, Centre says that profits will be shared 50:50 but all losses will be borne 100% by Delhi government. Is this fair on people of Delhi? Delhi government is only saying that losses should also be borne 50:50,” Kejriwal tweeted.
A senior official at the ministry of urban affairs, on the condition of anonymity, contended that the chief minister was “completely wrong”.
The Delhi Metro Rail Corporation (DMRC) in October, 2014 submitted the detailed project report (DPR) for Delhi Metro Phase-IV project that would be 104 km in length across six corridors. At the time, this did not have the approval of the Government of National Capital Territory of Delhi (GNCTD).
According to the ministry, the GNCTD gave its approval in December with the condition that “operating losses, if any, be shared between Government of India and GNCTD in 50:50 ratio and that the GNCTD will not bear any liability of repayment of JICA loan.”
The ministry official said that this was not acceptable.
“This is in contrary to condition of sanction of phase III of Delhi Metro wherein operational losses have to be borne by GNCTD only,” he said. “As per condition of sanction of other metro projects, repayment of external loan and operational losses are to be borne by the state. What the Delhi chief minister has said is completely wrong, there is no provision that profit is shared 50:50 ratio either. The DMRC is a company, it is their decision whether the profit has to be given to the state, which is a shareholder, or to plough it back into the system.”
The ministry also claimed that the state government on January 10, 2019 submitted another detailed project report comprising six corridors with revised costs, which again stalled the progress of the project.
“DMRC, in January, 2018, submitted revised proposal comprising only three corridors out of six at a cost of ₹345. 8 billion for approval to ministry in the first stage and the remaining corridors to be considered later. The proposal was also submitted to urban ministry without the financial approval of GNCTD... Since the proposal of metro phase IV has again been changed by Delhi government to six corridors, it again required fresh inter-ministerial consultation,” the official said.
“There are different conditions for different metro phases,” said a Delhi government spokesperson. “Till Phase II, the Centre had said losses will be borne 50:50, while for Phase III they said the state government will bear the loss. For Phase IV the urban minister had said ‘we will do it ourselves’ [central government will take care of finances], they also unilaterally increased the fares and now the Delhi government has given financial commitment for five years. They do not even have a mechanisms of finding out operating losses.”
“There is absolutely no difficulty in finding operating losses. Finding line-wise losses is a simple exercise,” the senior ministry official quoted above said.
