Hyderabad Metro: L&T Demands ₹6,000 Cr to Exit; Telangana Government Reviewing Proposal

The management of the Hyderabad Metro Rail project is witnessing increasing friction between L&T and the Telangana government. L&T has written to the government stating that it will exit the project if compensated with ₹6,000 crore. The repeated claims of losses by the company have prompted the government to seriously consider this proposal.

Metro Management Issues
Over the past few months, L&T has informed the government that metro operations have not been profitable, and debts and interest burdens have risen. However, the government believes that L&T has failed to properly manage the assets handed over to it during Phase 1. Additionally, the lack of parking facilities at major stations has contributed to the project not achieving its expected success.

Government Response
Chief Minister Revanth Reddy has already announced that the government will fully undertake the Phase 2 metro expansion. With a major expansion costing over ₹40,000 crore underway, the government believes that taking over Phase 1 responsibilities would not be a significant challenge. If L&T decides to exit, the government is ready to approve the proposal.

Project Coordination
To ensure smooth coordination and integration between the two phases, the government is discussing keeping the entire project under a single umbrella. In cities like Delhi, Bengaluru, and Chennai, metro systems are entirely operated by the government. Even if there are occasional losses, they are considered part of providing public transportation services. The Telangana government is also contemplating setting up a Special Purpose Vehicle (SPV) to manage funding if required.

Conclusion
The government is not proactively making this proposal; it will only approve it if L&T insists on exiting, according to reliable sources.