We are reluctant: Railways on Kolkata metro project

Indian Railways holds 74% stake in the project while Union Urban Development Ministry holds the remaining 26%

Within a year of the West Bengal government exiting the metro rail network here, the railway ministry has said it is reluctant to take forward the Rs 4,676-crore east-west metro project, owing to lack of funds.

The metro project aims to connect Salt Lake to Howrah.

“We are reluctant. The project has been thrust upon the railways by (chief minister) Mamata Banerjee,” Minister of State for Railways Adhir Ranjan Chowdhury told Business Standard.

Currently, Indian Railways has a 74 per cent stake in the project. The Union urban development ministry accounts for the remaining stake. In 2008, Kolkata Metro Rail Corporation (KMRC), in charge of executing the project, was floated as a 50:50 joint venture between the urban development ministry and the West Bengal government. However, in 2010, when Mamata Banerjee was the Union railway minister, an in-principle agreement was signed, enabling the railways to acquire majority stake in the project.  After taking over as West Bengal chief minister in 2011, Banerjee pursued the stake-handover case with the Centre, with her party member Dinesh Trivedi and, later, Mukul Roy, at the helm of affairs at the railway ministry.

Just months before the Trinamool Congress parted ways with the United Progressive Alliance government at the Centre, Banerjee managed to secure the Cabinet’s nod for the handover of the project to the railways, despite opposition from the urban development ministry. Japanese Bank of International Cooperation, which is financing half the project cost through a loan, had also opposed the move. For the cash-strapped Bengal government, the stake handover came as a respite.

“The railways already has too many pending projects. In all cities, it is the state government taking the responsibility for metro projects. Why would it be different in Kolkata? The railways has inherited a huge financial liability with this project,” Chowdhury said.

When asked whether the railways was looking for an exit route from the project, he said, “We are discussing the matter with the urban development ministry. Talks are at a preliminary level. We will see what can be done.”  

For this financial year, the project has a budgetary allocation of only Rs 100 crore. “Funding is an issue. Anyway, what is the point of a higher allocation if it cannot be used because of the state’s non-cooperation?” Chowdhury asked.

The 15-km metro project is also facing land acquisition hurdles, as some who lost their land in the process have moved the Calcutta High Court. Thought the court ruled in favour of handing the land to KMRC, the state has suggested the metro route be realigned.

Sources say some contractors have already threatened to pull out. Officially, the project is running two years behind schedule. And, officials say given the hurdles at the management and operational levels, it is almost impossible to meet even the revised deadline of 2015-16.