No guidelines, parameters to fix fares for Mumbai Metro

Revised fares for Mumbai’s first metro project are set to be announced by the Fare Fixation Committee (FFC) within 15 days. The fare, however, is supposedly based on assumptions rather than on any prescribed formula. The reason: the Central Metro Act does not have any guidelines or parameters for fixing fares.

Revised fares for Mumbai’s first metro project are set to be announced by the Fare Fixation Committee (FFC) within 15 days. The fare, however, is supposedly based on assumptions rather than on any prescribed formula. The reason: the Central Metro Act does not have any guidelines or parameters for fixing fares.

“There is no prescribed formula or mechanism in the Act to fix metro fares. So, we are going to fix new fares by studying submissions made to the committee by Reliance Infra and the Maharashtra government as well as people’s suggestions at the public hearing meeting. Based on these submissions, suggestions and project details, the fare will be fixed,” said a highly-placed source, who did not wish to be named.

The three-member committee had earlier called the state government and Reliance Infra to hear their side on the issue.

Interestingly, the state government refused to accept any hike in the capital cost of the Rs 2,356-crore metro project, Reliance Infra has claimed that the project cost has escalated to Rs 4,321 crore.

The Comptroller and Auditor General (CAG) has not yet started the audit of the project. The audit report would have helped the FFC while fixing new fares as the report would have provided clarity about various aspects of the project such as financial, expenditure, accounts and policy.

Initially, the 11.4-km Versova-Andheri-Ghatkopar (VAG) metro line was being developed under the Tramways Act till November 2013 when it was brought under the Central Metro Act.

The Act enabled the developer – Reliance Infra-headed Mumbai Metro One Pvt Ltd (MMOPL) to fix metro fares afresh, so it notified the new fares – Rs 10 to Rs 40 – using provisions of the Act, against the previous fare notified by the state government – Rs 9 to Rs 13, calculated as per the clauses in the concession agreement.

The issue then became a bone of contention between Reliance Infra and the state government, which forced the latter to approach the court of law. Two months ago, the apex court directed the FFC to fix fares before July 10.