OFF THE RAILS

The DMRC stares at a debt trap as its financial viability is under question. Where did the success story go wrong? The crisis has raised questions about the primacy of metros over other modes of transport

- Sanjay Raman Sinha

THE Delhi Metro Rail Corporation (DMRC) is in dire straits. As per a 2017 arbital award order, it has to pay its Reliance subsidiary, Delhi Airport Metro Express Pvt. Ltd (DAMPEL), a whopping Rs 7,010.08 crore.

During a recent hearing at the Delhi High Court, DMRC said that it had sought Rs 3,500 crore each from the central and Delhi governments, both of which are equity partners of the Metro. In another affidavit, DMRC said that it had decided against taking any further bank loans as it was already "reeling under financial crisis" and it may lead to a "debt trap". The High Court was hearing a petition filed by DAMPEL regarding the payment of the arbitration amount.

As of May 31, 2022, DMRC had incurred an interest liability of over Rs 300 crore due to delays in payment to the Reliance subsidiary. It is adding more than Rs 1.15 crore every day to its interest load. The debt crisis of Delhi Metro has raised questions about the financial viability of the metro system. It has also raised uncomfortable questions about the primacy of the metro over other modes of transport.

The Delhi Metro is a mass rapid transit system serving Delhi and its satellite cities-Ghaziabad, Faridabad, Gurgaon, Noida, Bahadurgarh, and Ballabhgarh-in the National Capital Region. The Delhi Metro is the largest metro system in India and considered one of the most "successful" public transport projects.

Over the years, it has seen an exponential rise in ridership. It was ranked 2nd of 18 international metro railway systems across the world in customer satisfaction. It had also reduced carbon emissions in the city and the United Nations had recognised it. With so many accolades under its belt, what went wrong?