Thursday, February 15, 2007

Mumbai Metro - oh no, not again

11kms. It’s not much really. It’s roughly the distance between Nariman Point and Prabhadevi or Churchgate to Lower Parel. Or Versova to Ghatkopar via Andheri (lets call it VAG) – the distance of the first leg of the Mumbai Metro.

Rs650crores. That’s a lot of money. Depends on your point of view though. For example the BMC has an annual budget of about Rs7,000crore to maintain the city. For example the Bandra Worli Sea Link is estimated to cost Rs1,306cr. For example, the entire Mumbai Metro project will cost – at least in today’s times – Rs20,000crores. Lots of zeroes there.

But I digress.

A question of viability
How much is Rs650crores ? A lot of money. It’s what will make construction of the VAG leg profitable for Reliance Energy, the contractors of the project.

If you recall, the VAG leg of the Mumbai Metro Project is a partnership between the Maharashtra State Government (as represented by the MMRDA) and Reliance Energy (REL). It's an example of a public-private partnership. It's also seen as the way forward in India for large (any?) infrastructure projects where the State is constrained to invest a large amount…because the State is most likely steeped in debt and pretty much flat broke.

However, for the private partner it makes sense. Besides making sense, the project should also make money. Profits. You know, the concept of returns, enterprise and such like. Nothing wrong with that.

So far so good ? But here’s the problem for the Mumbai Metro. Until Rs650crores is funded into the project by someone, the project will not be financially viable for REL. While the State Government feels the Central Government should foot the bill, the Central Government thinks otherwise.

The Central Government argues: The Mumbai Metro bidding had been completed before the setting up of the Centre’s Private-Public Action Committee. So, how can the Government approve its funding, if its committee was not in existence at the time of the bidding. Dicey logic ? There’s more.

The cost. At a whopping Rs215crore/km (simply Rs2,356crores divided by 11kms), VAG is almost twice as costly as the Delhi Metro (Rs120crore/km). Of course, the VAG leg will also be overhead (and not underground), but, I’m not an engineer or a consultant to figure the costing nuances between the two. This, it seems, is too expensive for the Central Government.

The State Government’s case: The Prime Minister gave his word when he laid the foundation stone of the Metro last year. Its time for him to live up to his word. Moreover, if the Centre can foot the bill for the Delhi and Kolkata Metro, why not Mumbai ?

And that's where this is at. This is where the Mumbai Metro is currently stalled.

Now, consider the timeline if you may -

1967-68: A Govt. of Maharashtra study on notes the possibility of a new rapid transit system such as underground rail

1973 (Regional Plan): Cautions against capital intensive projects like the Metro, suggesting instead decongesting South Mumbai, moving economic activities to Bandra Kurla, Navi Mumbai, etc.

1974: Indian Railways comes up with a plan for a Colaba-Kurla underground rail, which is shelved because its too expensive

1997: Tata Consultancy Services prepares a feasibility study on the Metro

1999: Chief Minister Narayan Rane assures a Mumbai Metro Planning Group that the project is "under consideration by the Cabinet sub-committee"

2004: MMRDA presents a master plan to Chief Minister Sushilkumar Shinde

2005: Delhi Metro Chairman Mr. E. Sreedharan presents Phase 1 of the project to Chief Minister Vilasrao Deshmukh, who approves it.

Jan-March 2006: Maharashtra Cabinet finally approves VAG, financial bids are called for.

May 2006: Disagreement between Reliance Energy - then the lowest potential bidder - and MMRDA over viability gap funding. While REL cites a number of Rs1,251crores, the MMRDA wants a number of Rs650crores. MMRDA wins and REL are awarded the contract.

June 2006: The Prime Minister lays the foundation stone for the Mumbai Metro

October 2006: First signs of problems between the Central and State Government.

February 2007: Present day. No resolution.

Getting nowhere in a hurry
Think about that. That's all the development that this State Government, or for that matter, the Central Government has been able to achieve. Leave alone construction of the Metro, leave alone the thorny issue of relief and rehabilitation of the people whose houses and offices will have to be removed for this project, leave alone the controversies surrounding of why such a project was chosen instead of cheaper projects like the Skybus, BRTS, upgrading the existing rail network...leave all of those past, present and future issues, all of it alone.

The fact of the matter is that we've gotten nowhere. Mumbai has gotten nowhere closer to the Metro. Think about it. 40 years - 1967 to 2007. And the politicians, planners, even us as people, have moved nowhere on the Mumbai Metro.

Frustrating ? Of course it is. It only goes to yet again underscore the fact that development and infrastructure will always be one part politics and no part necessity. And the kind of resolve, political will and sheer focus required to improve life in this city is sadly missing in the leaders we've chosen.

[Note: this is part of an ongoing series on this blog on the Mumbai Metro. For other posts on this issue, click on this label here.]