DNA Edit: Avoid PPP in metro rail

The Centre’s growing emphasis on Public-Private-Partnership (PPP) model in transport infrastructure underscores a cash crunch in the coffers. Along with mounting fiscal deficit, governments in the states and Centre are also hobbled by a lack of institutional framework that would have made private investments viable and sustainable in the long run. It is in this context that ‘Metro Man’ E Sreedharan’s scathing observations about the Union government’s diktat on seeking private participation in urban mass transit projects assume importance.

It all might seem a good idea to invite private entities to capital-intensive projects, but as Sreedharan rightly points out private funding in infra-projects would seek higher returns in shorter time frames, which is virtually impossible in the case of metro since fares must be kept reasonable, if not low. With real-estate prices witnessing a sharp decline, the carrot of land parcels for property development hasn’t also worked. It is clear that the onus of developing mass public transport is on the government if it wants cities to grow as economic hubs — Mumbai’s wheels of commerce are powered by the suburban railways network. Going by past fiascos, depending on private participation is too risky a proposition for developing metro rail. The government must pay heed to his warning that the new policy could sound the death-knell for projects around the country.  His words must be taken seriously.