Fate of Mumbai Metro Line II in limbo after Reliance Infra terminates contract

Mumbai: Reliance Infrastructure on Thursday terminated its agreement for the Rs 12,000 crore Mumbai Metro Line II project as it claimed the Government of Maharashtra had failed to fulfill its obligations.

The company has also asked for the return of Rs 160 crore bank guarantee.

The state government through an international competitive bidding had awarded the Project on August 3, 2009 to the consortium led by RInfra. The Concession Agreement was executed on January 21, 2010 between the Govt. of Maharashtra and MMTPL.

Reliance Infra terminates Mumbai Metro Line II contract
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In a statement, Reliance Infra said the various obligations listed under the concession agreement were not fulfilled by the state government for the project to connect Charkop in north Mumbai with Bandra in the west and Mankhurd in the east.

"The Government of Maharashtra and the concessionaire signed the termination agreement at no cost and no claims to either party," Reliance Infra said, adding that the bank guarantee of Rs.160 crore was to be returned to it.

Releasing its results for the second quarter of this financial year, Reliance Infra had Wednesday said its actual net profit of Rs.431 crore would have been higher by some 13 percentage points, but for the loss of Rs.57 crore on the Mumbai metro project.

Mumbai Metro One, also called the Line I project, is already being operated by a joint venture between Reliance Infra Veolia Transport of France and the Mumbai Metropolitan Region Development Authority.

Awarded in 2007 after an international competitive bidding process, the Line I project was country's first for mass rapid transport on a public-private partnership mode. Reliance Infra with 69 percent is the majority shareholder, as per its Web site.

In the case of Line II project, Reliance Infra holds a 48 percent stake in the company formed specifically for the purpose while SNC Lavlin of Canada and Reliance Communication hold 26 percent each.

What MMRDA has to say?

Responding to the RInfra release, Dilip Kawathkar, MMRDA Joint Project Director (PR), said, "The Concession Agreement arrived at between the State Government and the Mumbai Metro Transport Private Ltd. (MMTPL) has been terminated mutually. A formal communication from MMTPL for return of the Bank Guarantee is awaited and the procedure to return the Bank Guarantee will follow immediately thereafter."

What is the new plan of Metro line II?

The Mumbai Metropolitan Region Development Authority (MMRDA) will be seeking approval for the new plan of the completely underground Dahisar-Charkop-Bandra-Mankhurd line II from the state government in MMRDAs Authority meeting that will take place on November 20.

MMRDA officials claim that they are confident of getting MoEF clearance for the construction of car depot in Charkop and the planning authority has also identified a plot near Mandale village near Mankhurd where the second car depot of line two will be constructed.

Speaking to mid-day, Metropolitan Commissioner UPS Madan said, "Recently, we had a meeting with the Union Minister of Environment and Forest (MoEF) when he was in Mumbai and we gave him a presentation about the new underground Dahisar-Charkop-Bandra-Mankhurd metro line II. In the presentation, we also told the minister that in order to start the work having a car depot in place is important and so the MoEF should consider clearing the pending permission for constricting the car depot in Charkop."

It should be noted that earlier MMRDA was going to construct an elevated metro line II from Chrakop-Bandra-Mankhurd and the contract for the same was also awarded but the line remained a non-starter as the issue of construction of car depot in Charkop had not received permission from MoEF as there were mangroves plantation on the land adjacent to the proposed car depot land.

A fresh proposal for constructing an environment-friendly car depot was also submitted to the MoEF and it's still awaiting clearance. Later, MMRDA made changes in the alignment of the line and the new line will be from Dahisar- Charkop-Bandra-Mankhurd and will be completely underground.

"We are confident that we will get clearance for the construction of car depot in Charkop. Apart from this, we also have plans of setting up a car depot for this line ear Mandale village close to Mankhurd," Added another official.

The proposal of the new metro line two will be kept in front of MMRDA authority meeting that is scheduled for November 20th and once the proposal is cleared by authority, the planning authority can start the process of inviting bids for the line.

It should be noted that the new metro line will be 40 km long and will cost close to Rs 29,000 crore . The construction cost of the Charkop-Bandra-Mankhurd elevated metro track was close to Rs 8000 crore.

In the past there was also opposition to the elevated metro-2 line from the residents staying along the corridor between Vile Parle and Santacruz.

The ground breaking ceremony of the project was conducted by former president Pratibha Patil on August 18, 2008 for 32 km long metro rail corridor. However, apart from doing the soil testing work no progress has taken place.

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