The Maha Metro Dream

In India, the urban rail network has grown significantly over the past 10-12 years, from about 90 km in 2006 to 444 km as we speak. Currently, there are 53 cities over 1 million population which have started planning for the construction of metro rail projects. Of these, there are 20 cities with 2 million plus population in which 13 are currently executing metro rail projects and the remaining are planning to start.
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<p> The infrastructure sector is a key driver for the Indian economy. The sector is propelling India’s overall development and enjoys an intense focus from the government for initiating policies that would ensure the time-bound creation of world-class infrastructure in the country. The infrastructure sector has, therefore, become the biggest focus area for the Government of India. Under Union Budget 2018-19, USD 92.22 billion was allocated to the sector.</p>
<p>India’s infrastructure spending will have to accelerate to at least Rs 50 trillion between fiscals 2018-2022 to make a visible impact on service delivery and provide a foundation for rapid and inclusive economic growth. These projects factor an average annual GDP growth of 7 per cent, infrastructure investments equal to approximately 5.5 per cent of GDP and a pick-up in the private sector investments after fiscal 2019. Experts see the power, ports, railways, urban transport (metro rail) and urban sectors accounting for 78 per cent of the overall infrastructure spending. </p>
<p> <span style="font-weight: bold;">Urban transport </span><br />
In India, the urban rail network has grown significantly over the past 10-12 years. Currently, there are 53 cities with over 1 million population, which have started planning for the construction of metro rail projects and out of these, there are 20 cities with 2 million plus population in which 13 are currently executing metro rail projects while the remaining are planning to start the project. 10 cities already have an operational urban rail network spanning 444 km. In another major initiative, in April 2017, the government introduced the norms to procure metro equipment and rolling stock with indigenous manufacturing under the Make in India initiative. Further in August 2017, the government approved the new Metro Rail Policy (2017), to ensure sustained growth of Mass Rapid Transit System’s (MRTS’s) in general and Metro Rail, in particular. </p>
<p> <span style="font-weight: bold;">Key highlights:</span><br />
The policy aims to facilitate innovative financing by making PPP component mandatory for availing central assistance on metro projects. Thus, this policy clearly links the government assistance in capitalising the private resources, expertise and entrepreneurship.<br />
To ensure that the metro rail provides the last mile connectivity in the cities. Towards this, a catchment area of 5 km has been fixed for such projects on either side.<br />
The new policy mandates Transit Oriented Development (TOD) to promote compact and dense urban development along metro corridors since TOD reduces travel distances, besides enabling efficient land use in urban areas. This will essentially mean that urban mass transit projects should not merely be seen as urban transport projects but more as urban transformation projects.<br />
Adoption of innovative mechanisms like value capture financing tools to mobilise resources for financing metro projects by capturing a share of an increase in the asset values through Betterment Levy.<br />
To ensure financial viability, the Metro Rail Policy requires to clearly indicate the measures to be taken for commercial or property development at stations and on other urban land and for other means of maximum non-fare revenue generation through advertisements, lease of space, etc., backed by statutory support. States are also required to commit to accord all required permissions and approvals.<br />
Cities across India are employing state-of-the-art technologies to make urban rail systems more efficient, reliable and passenger-friendly given the rapidly increasing ridership. The Indian metro systems are moving from semi-automatic to unattended train operation or driverless train operations. Most of the upcoming systems have plans to deploy state-of-the-art signalling systems such as Communications-Based Train Control (CBTC) systems. They are also exploring the deployment of advanced fare payment systems such as open loop ticketing and bank cards.</p>
<p>The urban transport (metro rail) segment thus, offers a significant opportunity to various stakeholders. The projections indicate a realisation of an investment to the tune of about Rs 6 trillion for projects in the pipeline. According to India Infrastructure Research, there lies an opportunity of Rs 4.3 trillion for players across sectors such as construction, tunnel works, traction and E&amp;M, rolling stock, fare collection, signalling, etc.</p>
<p>Based on the projects tracked by India Infrastructure Research, in all, the project pipeline entails a total length of about 2,066 km of urban rail stretches, of which, the maximum length will be added between 2018 and 2022.</p>
<p>The governments- central as well as states- continue to fund majority of the urban rail projects. The private sector’s participation in the sector, particularly in the metro rail segment, has so far been limited due to high construction costs and long gestation and payback periods. Besides, land acquisition, securing of regulatory clearances, the right of way, engineering issues and geotechnical challenges are some of the pressing concerns of the sector at present.</p>
<p> <span style="font-weight: bold;">Maha metro</span><br />
The Nagpur Metro Rail Corporation (NMRCL) was reconstituted as Maharashtra Metro Rail Corporation (Maha Metro) for the implementation of all the metro rail projects in the state of Maharashtra, outside Mumbai Metropolitan Region. Presently, Maha Metro is executing metro rail projects in Nagpur and Pune. </p>
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<p> Authored by <span style="font-weight: bold;">Brijesh Dixit, Managing Director, Maha Metro.</span></p>