Maharashtra Govt approves purchase of Mumbai Metro Line 1 at ₹4,000 crores

Mumbai, India (Metro Rail Today): In a significant move, the state cabinet of Maharashtra has granted in-principle approval for the acquisition of the Mumbai Metro One (Ghatkopar-Versova). This metro line is a joint venture between Reliance Infrastructure Limited (R-Infra) and the Mumbai Metropolitan Region Development Authority (MMRDA). Reliance Infrastructure's stake in the venture has been assessed at ₹4,000 crore.

The Mumbai Metro One project, initiated in 2007, marked the first metro endeavor under the Build-Operate-Transfer (BOT) policy. The joint venture, known as Mumbai Metro One Pvt Ltd (MMOPL), comprises a 26% stake from MMRDA and a 74% stake from Reliance Infrastructure. The state cabinet's approval follows a report by retired IAS officer and former chief secretary Johny Joseph, who valued the Reliance Infra stake using the discounted cash flow model.

Despite being the most heavily used metro line, disputes marred the MMRDA-Reliance Infra collaboration. MMRDA officials had reservations about partnering with a private entity for a public project. The joint venture faced challenges related to operational losses claimed by MMOPL, disagreements on commercial exploitation of metro premises, ticketing structures, and fare hikes.

Controversies also surrounded the project costs, with MMOPL citing ₹4,026 crore and MMRDA countering with ₹2,356 crore. Furthermore, property tax demands from the BMC added to the complexity. In 2020, MMOPL proposed the sale of its stake to the state government and MMRDA due to financial setbacks during the COVID-19 pandemic.

Mumbai Metro Line 1 (Versova-Andheri-Ghatkopar Metro Line) is an 11.40 km elevated corridor that provides connectivity of Eastern & Western suburbs to Western & Central Railway.

This development paves the way for a significant shift in the ownership structure of Mumbai Metro Line 1, marking a new chapter for this vital transportation corridor.