It may take at least two more years for Hyderabad to see its metro rail up and running. L&T Hyderabad Metro Rail which is executing the public-private partnership project, now estimates that it may not be before December 2018 for it to complete the 72km elevated rail project.

“Given the present situation, we are estimating it will be complete around December 2018. There again are many ifs and buts here," said V.B. Gadgil, managing director and chief executive of L&T Hyderabad Metro Rail Pvt. Ltd.

The project, which is already almost two years behind schedule, has been facing several delays on the part of the government, as well as technical issues. It runs across the city in three lines and the first stage is running technical inspections and trials.

So far, the company has put in ₹ 9,000 crore, of the estimated ₹ 16,375 crore project cost. Given the delays, L&T had expected the cost to escalate by ₹ 3,000 crore. The viability gap funding of around ₹ 1,450 crore can be used only for core project activities and not for real estate development or others.

“We have got the first tranche of viability gap funding of ₹ 322 crore last month and will get the second tranche this month. Meanwhile, the thought process is on to raise more funds beyond the project cost. But then, the cost dynamics are dependent on several factors," Gadgil said.

It will take at least six to seven years after the project is complete to get to operational profits. L&T expects the initial ridership revenue to constitute around 45% of the total revenues, with the rest coming from real estate lease and advertising. “Over a period of time, the ridership revenue will go up by 5-7%," Gadgil said. So far, in four metro stations, the company has tied up around 70% of the total real estate rentals.

Project work in some of the areas was halted so far as there were protests from locals demanding change in design—for instance, near Sultan Bazar and Assembly—which has now been resolved.

“Aggressive mode of construction is on for stage two. The first phase will soon be ready for commissioning but it is difficult to say the timelines," he said. Of the total project, Gadgil says, foundation has been laid for 77% (around 56km) and columns are completed for 74%.

“Works in areas where we were not allowed to begin initially is now restricted to particular time frame as it is in utilities. In all the areas, once we have the viaduct direction in place and when we don’t have to worry about external circumstances like traffic and permissions, work can speed up," Gadgil said.

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