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Government sends strong letter to E. Sreedharan

C.V.S.K. Sarma charges Sreedharan with changing his stand


Sreedharan in letter to Ahluwalia expresses doubts about BOT project

Alleges that BOT developer has a hidden agenda to extend the network


HYDERABAD: Stung by criticism from a most unexpected quarter against the Hyderabad Metro project, the Government has sent a strongly worded letter to Delhi Metro Rail Corporation (DMRC) Managing Director E. Sreedharan on Monday.

“The draft concession agreement clearly brought out the scope for commercial exploitation of air space over land being provided to the BOT developer as per the detailed project report prepared by DMRC. After successfully awarding the project to the lowest bidder and appreciated by the Planning Commission, you seem to have changed your stand,” charged C.V.S.K. Sarma, HMR Chairman and also Principal Secretary, Municipal Administration and Urban Development Department. The Government had saved Rs.10,000 crore as the DMRC had estimated that the grant could be as much if prime land exploitation was not permitted, he said.

Scandal on cards?

A few days ago, Dr. Sreedharan wrote to Planning Commissioner Deputy Chairman Montek Singh Ahluwalia, expressing doubts about BOT projects for being “expensive in long run” and “main beneficiary” being the private party. No metro project has succeeded on BOT basis and alluded to the Mumbai example where “private sector efficiency expected was absent.” Rooting for the Delhi Metro model of joint ventures between the Centre and States for metro projects, he said it was necessary as they were capital intensive and returns were low preventing investors from coming forward. Instead, the government should develop lands to keep ticket prices down.

“One sparrow does not make a summer,” he said, referring to Hyderabad Metro. Making “available 296 acres of prime land to BOT developer for commercial exploitation was like selling the family silver,” he said and felt the land concession could lead to a “big political scandal some time later.” Dr. Sreedharan, famous for constructing and running the Delhi Metro successfully, alleged that the BOT developer had a “hidden agenda” to extend the network to his large land holdings to “reap a windfall profit of four to five times the land price.”

Of course, he saw no alternative to metro projects considering the growth of cities.

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