31 October - 6 November | 2011 | Projects Info Project cost and


execution The indicative cost of the project is Rs.12,132 crore (121.32 bil- lion). GoAP will entrust the project to a private develop- er on a long term Concession (about 35 years, extendable by another 25 years) in Public Private Partnership (PPP) mode on Design, Build, Finance, Operate and Transfer (DBFOT) basis.


GoAP has obtained “in


principle approval” for a grant of Rs.2,363 crore (23.63 bil- lion; about 20 per cent of the project cost) under the Viability Gap Funding (VGF) scheme of Government of India (GoI). As per the VGF scheme, GoI and GoAP can together extend a total financial support of a maximum of 40 per cent of the project cost, such support being limited to the amount quoted by the successful bid- der in a transparent competi- tive bid process. Larsen & Toubro Metro Rail


(Hyderabad), a subsidiary and a special purpose vehi- cle of the L&T Infrastructure Development Projects, has achieved financial closure for the Rs 12,132-crore metro rail project.


A consortium of 10 banks led


by SBI has sanctioned the entire debt requirement of Rs 11,480 crore and the equity compo- nent of around Rs 3,440 crore would be infused by the L&T


Feature ANDHRA PRADESH|19


group for the project, according to the company. The project would get a via- bility gap grant of Rs 1,458 crore from the central government through the state. The financial closure of the largest public pri- vate partnership project under design, built, finance, oper- ate and transfer (Dbfot) mode in the country till date, was achieved within six months of signing the project agreement. L&T Metro Rail (Hyderabad) has already submitted a per- formance guarantee of Rs 360 crore to the state government. The pre-construction works of the project has already started, and the soil testing and topo- graphical surveys have been completed in most locations along the alignment and con- ceptual engineering is near to completion.


As per the agreement, con-


struction would have to be completed in five years and the concession period for the project is 35 years (including 5 years of construction) and is extendable by an additional 25 years.


Real estate development


To enhance the financial via- bility and bankability of the project, the concessionaire will be allowed to undertake real estate development through commercial exploitation of air space over the lands provided for creation of project facili- ties such as depots and park-


“PPP projects worth ` 31,000 cr are in pipeline”


There is an immedi- ate need for arriving at a mutually beneficial Public Private Partnership (PPP) model where the interests of both the Government and the private sector will be protected. The nation should take into account the supremacy of Andhra Pradesh in PPPs where 214 projects worth Rs 81,000 cr have already been issued and 78 more, with worth Rs 31,000 cr, are in the pipeline. It is government’s responsi- bility to safeguard the investors interests simultaneously being accountable for the public. PPPs should be carried out in such a way that public should be benefited from them as end users. For the development to happen, infrastructure has to be developed. Government is pressed to cater to necessities like health, food security and education


N Kiran Kumar Reddy,


Chief Minister, Government of Andhra Pradesh


rather than planning for long term goals like infrastructure needs. But develop- ment can’t be stopped just for the lack of money. Here is where private investors can play a major role in building infrastruc- ture and facilitating development thus at the end benefiting the common man.


AP has come up with suc- cessful PPP projects like Outer Ring Road (ORR) and Hyderabad Metro Rail, and is always open for ideas. Of late PPP projects across nation have been reported with certain dif- ficulties like environmental bottlenecks, court monitoring, among others. Only with trans- parent systems these problems in PPPs will be addressed or else investments will run into problems.


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ing and circulation areas at select stations. The real estate development may be under- taken by the Concessionaire above the ground floor at the three depots at Miyapur (99 acres), Nagole (96 acres) and Falaknuma (17 acres) and above the parking and circu- lation areas at 34 select sta- tions (57 acres at Category II and Category III Stations) in accordance with the provisions of the Concession Agreement, Applicable Laws and Good Industry Practice. While the scope and details of the real estate development will be fur- nished to the bidders during the bid process, the cumula- tive built up area to be utilized for real estate development is likely to be about 18.5 mil- lion sq.ft. (about 12.5 million sq.ft. over the 3 depots and 6 million sq.ft. at the 34 select stations). The ownership of the land shall always remain with GoAP. The built up area can only be used for rentals during the Concession Period and it will have to be handed over to GoAP at the end of the Concession Period in accord- ance with the provisions of the Concession Agreement.


Institutional arrangement


With a view to providing a single point nodal agency to coordinate with various gov- ernment, semi-government and private agencies and facili- tating implementation of the


project by the Concessionaire, GoAP has established a Special Purpose Vehicle (SPV) in the form of Hyderabad Metro Rail (HMR) as it’s fully owned undertaking. Consisting of a small but highly motivated group of experienced engineers and senior government offic- ers, HMR has initiated several measures for acquisition of the required lands, identification of obstacles, R&R, obtaining right of way for the three corridors, etc. The Heads of utilities in the city such as Hyderabad Metro Water Supply & Sewerage Board (HMWSSB) and the Central Power Distribution Company of Andhra Pradesh Ltd (APCPDCL), and other con- nected senior officers of the government are on the Board of Directors of HMR. To provide legal cover for the


project, GoAP enacted “The Andhra Pradesh Municipal Tramways (Construction, Operation and Maintenance) Act, 2008”. The Act adequately deals with various aspects of construction, operation and maintenance of the proposed Metro Rail system.


Benefits


• With a maximum speed of 80 kmph, the average speed of the trains will be 34 kmph – an international standard for MRT systems;


• Rails will be continuously welded to minimize noise levels;


•


Power supply will be through 3rd rail bottom col- lection for better sky scape of the city;


• Coaches will be air-con- ditioned with automatic door-closures and many other safety features;


• Signaling system ensures safety and specified speeds through Automatic Train Control (ATC), and Automatic Train Protection (ATP);


•


Telecommunication facili- ties will be state of the art, facilitating continuous communication between Central Control, train driv- ers and station masters;


• Good inter-modal integra- tion will be provided at all the rail terminals, bus sta- tions, and the MMTS (exist- ing joint venture of GoAP and Railways) stations;


• All stations will have air con- ditioned “Merry go round” mini-bus services, connect- ing nearby colonies, busi- ness establishments and other popular places;


• • •


Eco-friendly Travel Mode – it will reduce air and noise pollution in the city;


Terminals and junctions will be connected with BRTS (Bus Rapid Transit System) routes; & Smart


Automatic ticketing & gate systems for passenger con- venience and seamless travel.


card-based


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