Union railway ministry decided to transfer much of its stake in Kolkata’s East West Metro Project to the urban development ministry so that the latter becomes the biggest stakeholder and more funds are drawn into the lagging project.
It is learnt that the division of stakes between railways and the urban development ministry would be 49 percent and 51 percent respectively.
The decision was taken since the urban development ministry was the co-conceptor of the East West Metro Project along with the then state government in 2008.
Like in other megacities, the state and the urban development ministry had 49 percent and 51 percent stake respectively in the Kolkata Metro Rail Corporation (KMRC) – the special purpose vehicle created for implementation of the project. KMRC applied for loan from the Japan International Cooperation Agency for majority funding.
But after Mamata Banerjee became the railway minister, it was on her insistence that the state transferred its share to the ministry of railway.
The railways became biggest stakeholder with 74 percent stake, while the urban development ministry was left with 26 percent stake. The logic behind the transfer was that the railways could easily integrate the E-W Metro with its existing and upcoming metro projects.
But the scene started changing fast with the Trinamool snapping its tie with the Union government.