Mumbai, India (Urban Transport News): The Mumbai Metropolitan Region Development Authority (MMRDA) is planning to take over the operation and maintenance of Mumbai Metro's Line 1 (Versova-Andheri-Ghatkopar) before launching the most awaited Line 2A & 7. In this regard, the executive committee of the MMRDA has recently approved the appointment of a consultant to carry out due diligence of assets of Mumbai Metro Line 1 before a formal takeover.
Sources said that last year, Reliance Infrastructure Limited (R-Infra) had written to the Maharashtra government asking to buy its stake in Mumbai Metro One Private Ltd (MMOPL), which runs the 11.5-km Line 1. This is the first Metro line in Mumbai, which was built on a public-private partnership (PPP) model and was commissioned in 2014. Reliance Infrastructure holds 69% of the equity share capital of MMOPL, while MMRDA holds 26% and the remaining 5% is held by RATPDev Transdev Asia.
“Since MMRDA is constructing all Metro lines across the region, the acquisition will add synergy to the operation of other lines. Also since it is a public transport infrastructure and MMOPL is unable to run it, it is incumbent upon the government to take over,” said RA Rajeev, Metropolitan Commissioner, MMRDA adding the authority had the first right to buy R-Infra's stake.
R-Infra has evaluated its share value between Rs 2,500-2,600 crore for its share in MMOPL. The consultant will visit all the assets created by MMOPL, assess their value and compare against their book value, which will enable MMRDA to decide on the amount to be paid to R-Infra. The consultant will submit their report in the next four months.
"The fare structure has been a source of friction between MMRDA and MMOPL, with the latter asking for a fare hike citing an increase of Rs 1,935 crore in project cost over the original cost of Rs 2,356 crore. MMOPL had also cited a daily loss of Rs 90 lakh in operations," sources said.
Once the formality completed, the Mumbai Metro Line 1 will be handed over to Maha Mumbai Metro Operation Corporation Limited, a special purpose vehicle formed by MMRDA to operate and maintain all future lines of the Mumbai Metro Rail project in the Mumbai Metropolitan Region.