Rapid Metro will need one lakh commuters/day to break even
Gurugram: The Millennium Post in its report on September 10 had highlighted how taking over Gurugram private metro will prove to be an Achilles Heel for the Haryana government as it will have to acquire 80 percent of the Rs 3,000 crore of debt and have to pay at least Rs 2,560 crore of public money to run Gurugram's private metro.
With election seasons, many opposition parties are already criticising a huge amount of debt which the state is reeling under: a fact that was disclosed by the Comptroller and Auditor General (CAG) in a report. The Government will have to ensure that there are over one lakh commuters that have to use the services of Gurugram private metro daily for it to only break even.
Not able to meet its targeted ridership of one lakh — for the first and second phases put together — the almost 12-km-long metro network has been on shaky ground financially since it began its commercial operations on November 14, 2013. The first signs of trouble appeared last year when Rapid MetroRail Gurgaon Limited (RMGL) accused the Haryana Shehri Vikas Pradhikaran (HSVP), formerly Haryana Urban Development Authority (HUDA), of material breaches and defaults on the concession contract and asked the Haryana government to fix them within 90 days.
The audit by the Haryana government however reveals that thing was not as bad as it seemed in the month of June and July the Gurugram metro had seen a rise in the number of commuters and income. An investigation is now being sought of whether there has been any financial irregularity or not.
The Rapid Metro, which is facing closure on account of financial crisis, recorded an operating profit of Rs 3.81 crore in the last financial quarter, shows a response sent by the operator, Infrastructure Leasing & Financial Services Limited (IL&FS), to the Haryana government which sought an inquiry into the finances of the privately-run service. The letter states that the service's gross revenue for April, May and June 2019 was Rs 18.49 crore.
The revenue from passenger fare was Rs 8.40 crore, whereas non-fare revenue was Rs 10.09 crore. DLF Phase 3 sees the highest at 11,500 people a day, according to the survey.
Rapid Metro has been
breaking even on operational costs, which come to about Rs 6 crore per month. The financial liability they said, arises from additional loans and interest accrued by the service (at least Rs1,800 crore, according to the operator), which nullifies any profits.
