Centre approval for Nagpur Metro Rail project was for Old Estimate

नागपुर Nagpur (NGP): In what can be termed as a major worry for the city’s metro rail project, the central government has not given approval to the revised project cost of Rs 10,526 crore and instead given nod to the old estimate of Rs 8,680 crore, leaving a shortfall of Rs 1,846 crore worth of funds. However, the project’s nodal agency Nagpur Improvement Trust (NIT) is confident that the revised project cost would be approved.

What is clear is that the whole process of appointing a consultant, preparing the final detailed project report (DPR) and getting state and central approvals will have to be done all over again leading to a further delay of at least eight months.

The NIT had received copy of the union cabinet’s nod to the project only a couple of days ago. The union cabinet met on August 20 and approved the project. The next day Prime Minister Narendra Modi performed bhoomi puja of the project in the city.

The discussion on confusion related to approved project cost kicked off after union minister of urban development Venkaiah Naidu read out project’s cost as Rs 8,680 crore in his speech at the bhoomi puja programme. The copy of union cabinet cleared that approval was given to Rs 8,680 crore which was the estimate of 2012-13 fiscal. Revised project cost of Rs 10,526 crore was according to prevailing prices.

Slamming the central government, guardian minister Nitin Raut told that this disparity was enough to prove that the role of government at the centre was not clear. “I ensured state approval to revised project cost within an hour. Then the state submitted the project for the union cabinet’s nod,” he said.

NIT chairman Pravin Darade said there was nothing to worry. “It was not the final DPR. Approval was given to the old estimate as already in-principle nod was given to it. Now, a general consultant will be appointed for preparing the final DPR. The project’s exact cost will be derived in the final DPR. It will take at least eight months for preparing the final DPR. Again, the state and centre will approve the DPR. Then onwards cost escalation, if any, will not be approved by the centre,” he said.

Sources at the NIT and NMC told no escalation in the project’s cost is permitted by the centre and state government. “Take the example of projects approved under JNNURM or other scheme. Centre and state do not bear the escalation cost and it is borne by the implementing agency. It is not clear that this was the main reason behind not giving nod to the revised project cost. But the special purpose vehicle Nagpur Metro Rail Corporation Limited (NMRCL) will have to bear the difference of Rs 1,846 crore. Revision in the project cost was done citing escalation of prices in two years,” sources said.

NIT superintending engineer SS Gujjalwar said provision of escalating the project by 7.50% every year was made in the project itself. “But any revision requires the approval of centre and state. Union cabinet’s nod was must for further process. Application to form NMRCL has been submitted with the state. Another proposal to permit appointment as Delhi Metro Rail Corporation (DMRC) as general consultant is also submitted with the state,” he said.

Gujjalwar said the process to prepare proposal for obtaining 50% of project’s cost as loan going on. “Centre and state’s share was 20% each and NMC and NIT’s share at 5% each. We are planning to raise 50% amount from Japan-based Japan International Co-operation Agency (JICA),” he said.

According to information, JICA is providing technical and financial aid to developing countries to implement projects and one of the top financiers for Delhi metro rail project.

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