The Mumbai Metro Rail Project will be taken up by the secretary-level appraisal committee meeting on Wednesday.
NEW DELHI: The Mumbai Metro Rail Project, being developed jointly by Mumbai Metropolitan Region Development Authority and Anil Dhirubhai Ambani Group, will be taken up by the secretary-level appraisal panel meeting on Wednesday to assess whether the project could be funded under the Viability Gap Funding.
It is yet to be decided whether the Rs 2,356 crore Phase One of the project is eligible for VGF or not, a key Finance Ministry official said.
The project has sought Rs 650 crore of VGF, 20 per cent of which is to be contributed by the Centre and the remaining by the Maharashtra Government.
In July, the Finance Ministry had given preliminary clearance to the project after which the Urban Development Ministry, a nodal authority for the project, gave comments on it.
On reports that the Finance Ministry is now denying VGF for the project on the grounds that the bidding for the project was finalised before the Public-Private-Partnership Appraisal Committee (PPPAC) was formed, the official said nothing has been decided as of now.
Whether the project is eligible for VGF or not will be decided at the panel's meeting on 1 November, he said.
The MMRDA maintained that if the project is not cleared, the state government would arrange for the funding through the authority.
The scheme of VGF has been formulated to provide funding in the form of capital grant not exceeding 20 per cent of the project. The funding is given since many infrastructure projects may not yield the desired returns because of the low paying capacity of users.
According to sources, the Finance Ministry is of the opinion that the project should get funds from the Urban Development Ministry under the Jawaharlal Nehru Urban Renewal Mission.
According to the model concession agreement, the Phase I of the Mumbai Metro Project will be implemented on a build-own-operate-transfer basis for 35 years. The rate of return on the project has been fixed at 15 per cent.
Prime Minister Manmohan Singh had laid the foundation stone of the project in June.
The Phase 1 of the project would run from Versova through Andheri to Ghatkopar, covering 11 km and providing the much needed east-west link in the crowded city.
The Prime Minister had expressed hope that the phase would be completed by 2009.
The Rs 19,525 crore project is scheduled to cover 146 km and slated to be completed in three phases.
PPPAC has received 17 proposals so far, of which two were given approval and one was withdrawn, leaving 14 cases as pending.
The two that have been given approval include six and four-laning of Delhi-Haryana Border to Rohtak section, including construction of Bahadurgarh and Rohtak bypasses in Haryana.
Besides Mumbai Metro, two other projects relating to development of multipurpose berths at Kandla Port and Murmagao Port are scheduled to be taken up.
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