A war of words has broken out between the Congress and BJP leaders in Telangana over the delay in the sanction of central loan for the Hyderabad Metro Rail project.
At the centre of the dispute is the delay in disbursement of a Rs 13,500 crore loan from the IRFC (Indian Railway Finance Corporation) for the Hyderabad Metro Rail (HMR) Phase I takeover from L&T Metro Rail Hyderabad (L&TMRH).
Chief Minister A Revanth Reddy said the funds were due for release on Monday but there had been no clearance from the Centre so far. He alleged that Union Minister for Coal Mines G Kishan Reddy, who hails from Hyderabad, had pressured the Centre to stall the release.
However, the Union Minister dismissed the allegation and said the delay was due to technical reasons and had nothing to do with politics.
He said it was unbecoming of a Chief Minister to make such allegations without substantiating them. “Can Revanth Reddy name the Minister who allegedly told him that Kishan Reddy wanted the funding to be stopped?” he asked.
He noted that the Telangana government had entered into an agreement to secure Rs 13,500 crore and that the matter should be resolved through discussions among the stakeholders concerned. Kishan Reddy pointed out that the Chief Minister had met Union Minister Manohar Lal Khattar several times regarding the issue and that certain modifications had been suggested. The pending issues were technical in nature and required discussions between the Centre and the State government, he said.
“Projects do not come to a halt simply because Kishan Reddy wants them stopped. When I spoke with ML Khattar today, it became clear that neither side has complete clarity on the loan issue. This matter needs to be discussed and resolved,” Kishan Reddy said.
Also read: T’gana CM alleges Centre, BRS blocking Hyderabad Metro Phase-2
He maintained that issues relating to the Metro Phase-I loan and the Centre-State partnership for Phase-II should be finalised through dialogue rather than public criticism. Revanth Reddy was attempting to divert public attention and cover up his government’s failures, he alleged.
Stating that metro rail corporations across the country do not prioritise debt servicing over operations and maintenance (O&M), he said metro revenues should first be utilised to meet O&M expenses before loan repayments.
Interestingly, the Chief Minister chose not to respond to these observations on the proposed repayment structure. Instead, he reiterated that the decision to refinance Hyderabad Metro’s existing debt through IRFC was based on sound financial considerations.
Revanth Reddy maintained that refinancing through IRFC would provide a longer repayment tenure and lower interest rates backed by sovereign-level repayment safeguards and the RBI’s Direct Debit mechanism. The arrangement, he said, was intended not only to facilitate the takeover transaction but also to place Hyderabad Metro on a sustainable financial footing and ensure its long-term viability.
The Chief Minister recalled that, as per IRFC’s conditions, the Telangana government had already paid an upfront fee of Rs.84.32 crore for the release of the first tranche of financing. In addition, the state had deposited Rs.1,461.47 crore towards the equity component of the transaction in an escrow account.
He further stated that the Telangana government had addressed concerns relating to the operational integration of Metro Phase-I and the proposed Phase-II project. The State had requested the Centre to sanction Phase-II as a 50:50 joint venture.
However, if approval for the joint venture model was delayed, the Telangana government was prepared to execute Phase-II using its own resources and institutional financing arrangements, provided the Centre grants the required approvals without delay, he said.
“The Telangana government and the people of the state are not asking for charity or any special favour. We are only seeking the disbursement of a duly sanctioned IRFC loan,” Revanth Reddy stated.
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