HYD Metro re-alignment ruled out as Metro Rail (Construction) Act comes in as a shield

हैदराबाद Hyderabad (HYD): In what could be a significant step to clear a major legal hurdle for Hyderabad Metro Rail, the Centre notified the project under Metro Railways (Construction) Act, 1978.

While this brings in a much-needed rectification as the project had earlier been erroneously implemented under the provisions of Tramways Act, the step could even put the ongoing controversy over the proposed change of alignment at rest. While Telangana chief minister K Chandrasekhar Rao’s insistence on realignment had kicked up a storm, the notification issued on September 19, 2014, ratified the original routes agreed upon in the concession agreement signed by the state government and Larson & Toubro, which is executing the project under public-private partnership (PPP) model.

“It is clear that the Centre has intervened at the right time when the controversy was reaching a breaking point, and L&T went to the extent of threatening to pull out from the project,” said a senior official in the department of municipal administration and urban development (MA&UD).

However, analysts said the corrective measure did little to allay L&T’s apprehension that the project would be unprofitable because revenues from real estate would be low due to division of Andhra Pradesh. “In a letter written to the state government recently, the L&T had highlighted the fact that the project lost the potential in terms of revenue model due to bifurcation. And the slowdown in real estate market was the major concern. I don’t think that the Centre has addressed this issue while attempting to bring peace between the TRS government and L&T,” said an analyst.

KCR wanted the alignment to go underground near the state assembly building and a diversion near Sultan Bazar as he was concerned about saving aesthetics of the assembly building and livelihoods of traders. However, his insistence led to brinksmanship with the L&T refusing to heed. And the tussle reached the flash point with the construction major writing to the state government asking it to take over the project.

While this would have hurt the investor sentiment in the new state of Telangana, the Centre has apparently stepped in to stem the rot and notified the project under Metro Railways (Construction) Act, 1978, as well as the three Metro Rail corridors – Corridor I (Miyapur to L B Nagar), Corridor II (Jubilee Hills Bus Station to Faluknuma) and Corridor III (Nagole to Shiplaramamam).

The notification read: “The Central government hereby adds the metro alignment of Hyderabad Metro Rail Corridors Phase-I in respect of the metropolitan area of Hyderabad to the schedule of the said Act.”

Amidst the raging controversy, chief secretary Rajiv Sharma along with B V Papa Rao, advisor to Telangana government on infrastructure, had met cabinet secretary of Government of India Ajit Seth in Delhi on Monday. Sources said the meeting was the result of truce called by the Centre.