The Hindu : New Delhi News : Deadlock continues over Metro projects

Online edition of India's National Newspaper
Friday, Oct 15, 2004

New Delhi

New Delhi

Deadlock continues over Metro projects

By Gaurav Vivek Bhatnagar

NEW DELHI, OCT. 14. The Delhi Metro railway project, which is greatly dependent on commercial exploitation of its properties for making its operations financially viable, has run into a major hurdle in the form of the Land and Development Office under the Union Ministry of Urban Development as it has withheld issue of no-objection certificates for nearly a dozen construction plans, stalling development work worth about Rs. 500 crores.

The stalemate has been continuing for nearly a year now and despite the change of guard at the Centre has shown no signs of an early resolution. The problem arose when the L&DO demanded that the Delhi Metro Rail Corporation pay it the commercial rates for the properties allotted to it. The argument of L&DO was that the land had been provided by it for the Delhi Metro project at the transfer rates and if it was to be commercially exploited than commercial rates should be paid for it.

The DMRC countered the demand by saying that right from the beginning it was known that it would use properties with it for commercial purposes to cross-subsidise its operations since urban transport in itself can never be a profit-making venture due to the high costs involved in fixed assets as well and recurring and operational expenditures.

With the L&DO insisting that it would not issue the NOC if the Metro properties were used for anything other than operational purposes, the issue snowballed into a major one as it concerned nearly a dozen properties across the Capital on which the DMRC had planned projects worth over Rs 500 crores.

According to sources, the controversy has primarily affected those projects in which the DMRC was getting the construction done through developers. As such the project at Khyber Pass has run into a legal wrangle as the developers have already been appointed by the DMRC but in the absence of the NOC they are not in a position to start construction of a commercial-cum-residential project there.

The other major commercial projects affected by the stalemate at the Bhai Veer Singh Marg project and the Khyala project. Both of them involved construction on plots measuring over two hectares each. Similarly, there are around 10 other sites in which the work has got stalled.

Ironically, the stand-off has spared those projects in which the land had been allotted by L&DO or Delhi Development Authority but the construction had been undertaken by DMRC out of its own resources. One such big project is the Information Technology Park being built by DMRC near the Shastri Park Depot. By raising its own funds -- primarily through loans from the Delhi Government -- the DMRC has almost completed the first of the three buildings which would house major IT players. Also, it is learnt to be in consultation with some major IT companies for leasing out the space. But since the private developers cannot undertake any construction till they get the NOC, the other projects are hanging fire.

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