DMRC’s takeover of Airport Express comes costly
Reliance Infrastructure, which walked out of running the Airport Express, has demanded termination payment from Delhi Metro Rail Corporation (DMRC), which took over the operation and maintenance of the line today. Subhendu Ray reports.delhi Updated: Jul 02, 2013 02:36 IST
Delhi Airport Metro Express Private Limited (DAMEPL), a subsidiary of Reliance Infrastructure which walked out of running the Airport Express, has demanded termination payment from Delhi Metro Rail Corporation (DMRC), which took over the operation and maintenance (O&M) of the line on Monday.
The DAMEPL, which ran the line till Sunday night, has not specified the amount of termination payment, but sources said it could translate to nearly R3,000 crore.
A DAMEPL spokesperson said they had terminated the concession agreement nearly nine months back vide its notice on October 8, 2012. "The termination clause had to be invoked as DMRC had persistently failed to cure the substantial defects in the civil structure designed and built by DMRC," he said.
Urban Development minister Kamal Nath said the legal issues will be examined. But Sharat Sharma, director (operations), DMRC, refused to comment as "this is in arbitration".
Meanwhile, after the takeover, the first announcement the DMRC made was that the agency will try and make the service commuter-friendly and the project financially viable. But all this is easier said than done.
Apart from the private concessionaire claiming a contract termination payment, there is the difficulty of securing funds for the ongoing phase 3 expansion and finish the work in time.
Add to that the extra burden of paying the wages of nearly 500 former DAMEPL employees. Moreover, the 22.7-km line had been incurring losses to the tune of R4 crore per month during DAMEPL's tenure.
Soon after taking over O&M of the line, DMRC started taking commuters' feedback on how to better the network. Its spokesperson Anuj Dayal said, "Give us some time and we will try to make it a commuter-friendly service."
Among many of the suggestions received were fare rationalisation, feeder connectivity between Terminal 3 and Terminal 1 of IGI airport, Rajiv Chowk Metro station and Shivaji Stadium airport Metro station apart from increased frequency of trains.
"We will consider the suggestions and implement whatever is possible. We have now taken over only the O&M and are yet to take over the whole system, including the assets. The revamp will start soon after," said Sharat Sharma.
But DMRC is not sitting on a bed of roses. Its finances are in a mess, with there being almost no progress on the proposal to revise the fare structure, which has been pending for a year now.
"We are yet to know the reaction of the bankers, who have invested in the project, about the takeover," Sharma said. He, however, clarified that nothing will be done at the cost of the ongoing phase 3 expansion.