Namma Metro not yet yours

Delay in Central nod may hit project
Namma Metro not yet yours
Deccan Herald

Although the Group of Ministers (GoM) which met here last week had cleared three issues governing the Metro Rail in large cities, the BM needs clearance from the Union Cabinet as well as the Cabinet Committee on Economic Affairs (CCEA).

The Central clearance to the Bangalore Metro (BM) is set to be delayed raising a question mark on the approval for the Rs 1,800-crore soft loan to the project from the Japanese Bank for International Co-operation (JBIC).

Although the Group of Ministers (GoM) which met here last week had cleared three issues governing the Metro Rail in large cities, the BM needs clearance from the Union Cabinet as well as the Cabinet Committee on Economic Affairs (CCEA).

Speaking to Deccan Herald, Union Urban Development Minister S Jaipal Reddy said it would take 2-3 weeks for the Cabinet and CCEA to meet and approve the Bangalore Metro depending on the agenda before these panels. The JBIC board will be meeting in Tokyo on March 28 to take decisions on its external funding projects and it will consider the BM only if the project has CCEA approval. There is a possibility that if BM misses the bus, the project would be considered only a year later by which time the whole project may become unviable what with each day’s delay costing an additional Rs 80 lakh although Mr Reddy thinks otherwise. Mr Reddy, who will be in Bangalore on Sunday in connection with the inauguration of a CPWD (Central Public Works Department) building there, remarked: “The GoM recommendations will go before the Cabinet, while the BM has to be placed before the CCEA because it has to decide the financial issues such as Central equity.”

When pointed out that the JBIC board might not take up the issue for the next one year if it failed to come up before it on March 28, Mr Reddy pointed out: “I have been given to understand by my officials that it won’t be much difficult to get the JBIC loan validity extended. For us, the CCEA meeting is important because we are putting in money in the project.” JBIC has already given initial approval for a soft loan of Rs 1,800 crore to BMRC at 1.3 per cent rate of interest. There will, however, be uncertainty over the future of the loan portion. Incidentally, the BM project was the largest loan amount that the JBIC considered among the 10 projects it agreed to, this fiscal.

The CCEA clearance for the BM is crucial for it is the final arbiter on the Rs 1650-crore that the Centre will have to pump into the project. Of this, the equity portion is to the extent of Rs 1,000 crore, tax waiver Rs 430 crore and subordinate debt (at five per cent) Rs 200 crore. As for the state, it will put in equity and subordinate debt of Rs 1400 crore and about Rs 180 crore in tax exemptions.

The Cabinet, will consider the GoM decisions which left to the states the decision on the type of gauge their cities need and the legal cover. On the safety aspect, the GoM decided that it would be decided by the Commissioner of Railway Safety. The next Union Cabinet and CCEA meetings are likely to be held on March 23.

CM SPEAK

Metro will be on track

Chief Minister H D Kumaaraswamy on Friday made it clear that there was no question of either stopping or delaying the Bangalore metro rail project, reports DHNS from Bangalore.

“We will implement the metro work on a war-footing,” he told the Assembly in the wake of the apprehensions that the metro project had suffered another road block following the reported stay issued by him on acquiring of private properties in Malleswaram.