Hyderabad’s metro network, a lifeline for millions, is caught in a frustrating standstill. The Telangana government’s ambitious plan to expand the system by 122.9 kilometers—a project valued at a staggering ₹38,595 crore—is going nowhere fast without crucial clearances from the Centre.
Why Central Approval Matters
State officials are clear: they can’t move an inch without New Delhi’s nod. Low-interest funding for the proposed acquisition of the existing 69.2-km network from L&T Metro Rail Hyderabad Ltd. remains out of reach. More than that, provisions under the Railway Act and Metro Rail Act demand central involvement at multiple stages.
“Even when metro rail systems are developed by State governments, safety certifications are issued by the Commissioner of Metro Rail Safety (CMRS) under the Ministry of Civil Aviation. The officer is generally drawn from railway engineering services,” explained a senior official familiar with the process.
Financing Hurdles and Hopes
This isn’t the first time funding efforts have hit a wall. An earlier proposal involving a ₹13,527-crore loan from the Indian Railway Finance Corporation (IRFC) collapsed in May after the Ministry of Railways pointed out that IRFC’s mandate is limited to financing new infrastructure—not refinancing existing assets. Officials admit it’s unclear how this was overlooked.
Now, SBI Capital Markets (SBI Caps) is exploring the possibility of securing a soft loan of around ₹13,500 crore through entities in Gujarat’s GIFT City. The government is prepared to release its equity contribution of ₹1,462 crore to L&T, based on valuations by IDBI Capital and DMRC International, once the loan is secured.
| Key Financial Figures | Amount (₹ crore) |
|---|---|
| Phase II Estimated Cost | 38,595 |
| Proposed Soft Loan | 13,500 |
| State Equity Contribution | 1,462 |
A Glimmer of Progress?
There was hope after a high-level meeting in June between Chief Minister Revanth Reddy and Union Ministers Ashwini Vaishnaw, G. Kishan Reddy, and Manohar Lal Khattar. They charted a roadmap that involved SBI Caps finding a lender, with the government servicing the loan, and merging Hyderabad Metro Rail with Hyderabad Airport Metro Limited before the Centre takes a 50% stake.
But it’s still unclear if all central ministries have formally approved this model. HMR authorities remain confident, pointing to clearances from the Reserve Bank of India and assurances for the borrowing plan.
Meanwhile, efforts to procure 60 additional coaches for the existing network also await statutory clearances from agencies like the Research Designs and Standards Organisation (RDSO) and the CMRS.
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