Why are Mumbai’s big-ticket projects always controversial?


By Shailesh Gaikwad, Hindustan Times

The proposed hike in Mumbai metro fare, following recommendations by the Centre-appointed Fare Fixation Committee (FFC), has become a tricky issue for both the state and the Centre even as commuters continue to react angrily to the steep hike.

Reliance Infra-promoted Mumbai Metro One Private Limited (MMOPL) has made it clear it will have to increase the fares as the present structure is commercially unviable. If the FFC recommendations are implemented, the fares will jump from Rs 10-40 to a maximum of Rs 110.

The MMOPL has also asked the government to give it a grant of Rs 1,000 crore to ensure that the project is viable. This is in addition to Rs 650 crore viability gap funding (VGF, which is government’s contribution to make the project financially viable for private partner) given by the Centre, Rs 133 crore contributed by the state government in the form of equity as well as land in Mumbai given by the state to build the project.

While the MMOPL points out that the commute on Versova-Andheri-Ghatkopar metro line is faster and the fares lower than other airconditioned public transport options such as fleet taxis and BEST buses, the government officials insist that the contribution of Rs 783 crore by Centre and state as well as land worth crores should also be taken into consideration while deciding the fare. More info