A metro train moves along an elevated corridor near the State Assembly in Hyderabad. | Photo credit: RAMAKRISHNA G.
The second phase of the Hyderabad Metro Rail seems increasingly entangled in a mix of legal hurdles, political undertones and bureaucratic delays. It has been more than a month since the Congress government announced its bold move of taking over Phase I – 69.2 km – from L&T for ₹ 15,000 crore. The committee headed by the chief secretary tasked with working out the details of the takeover has not even met yet.
Top officials on both sides admit it will be a lengthy legal process. At the heart of this is the Concession Agreement (CA) between L&T and the state government – a legal knot that will take some time to untangle. Moreover, the fact that the project comes under the Central Metro Act and the Center has put in ₹1,200 crore under the Viability Gap Funding (VGF) means that their approval is required.
Meanwhile, Union Minister for Coal and Mines G. Kishan Reddy recently revealed another twist – the revised Detailed Project Report (DPR) for II. phase covering 76.4 km across five corridors, costing ₹ 26,264 crore, has not even reached the Ministry of Housing and Urban Affairs (MoHUA). This DPR is critical to the integration of Phase-I with the upcoming expansion and highlights how complicated the project has become.
Without Center’s nod?
Despite this, the state government seems keen to go ahead with Phase II or at least a part of it without waiting for the Centre’s mandatory clearances. Since a sovereign guarantee from the center is necessary for low-interest financing from global lenders, the backup plan is to borrow from commercial banks, sources said.
Ironically, L&T Metro Rail Hyderabad (L&TMRH) has long complained that interest payments on its ₹11,000-crore SBI-led loan are drying up the company — a key reason for its exit even as ridership and revenue have steadily improved over the years.
But officials insist that without a “proper” DPR and approval from the Centre, nothing but the foundation stones can happen. “Verifications from central ministries, including MoHUA and railways, are critical because of the interconnected design, technology and safety issues,” said officials who worked on Phase I. And without the Railway Safety Commissioner’s certification, metro trains simply cannot run.
Published – 16 Nov 2025 23:49 IST
