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After GIFT City, IL&FS saga clouds Ahmedabad Metro project

Metro-Link Express for G’nagar, A’bad issue a notice to IL&FS for work delay

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Will the IL&FS saga delay the Ahmedabad Metro rail work? There are strong chances of this, as IL&FS Engineering, a subsidiary executing a stretch of the Metro rail corridor has stopped work for the last couple of months since its parent company’s financial woes became public. The Metro-Link Express for Gandhinagar and Ahme-dabad (MEGA), which is developing the Ahmedabad Metro Rail project, has issued a notice to the company, after work on the project was halted by the latter.

“We have issued a notice to IL&FS Engineering. We have asked the company to either restart work on the project, or to wind up so that we can give the contract to someone else,” IP Gautam, managing director of MEGA, said.

According to officials, IL&FS Engineering was awa-rded the contract for building the elevated Metro stretch from APMC to Shreyas, which is a part of the 18.87 km North-South corridor, in December 2015. The Rs374-crore contract also includes construction of four Metro stations at APMC, Jivraj Park, Rajivnagar, and Shreyas. Work should have been completed by now as per the contract’s terms.

Gautam said that about 70% of the slated work has been completed, while the rest of the work is running a month behind schedule.

Work came to a halt after workers and staff of the project contractors did not receive their salaries as the IL&FS crisis unfolded in October. As instances of mismanagement came to light one after another, the central government superseded the IL&FS board and appointed an independent board led by banker Uday Kotak to steer the infrastructure major through the crisis. IL&FS is estimated to have a debt of Rs91,000 crore, and the new board has set in motion plans to sell a stake in several subsidiaries to cut debt burden.

The Gujarat government recently announced that it would buy the 50% stake held by IL&FS in GIFT City to prevent delays in the project. Some senior officials of IL&FS Engineering met MEGA officials on Thursday and sought time citing the group’s situation.

“They apprised us about the group’s reconstruction plan, but we asked them to ensure that Metro is not delayed. We want the work to be completed at the earliest,” said Gautam. While inauguration of the North-South corridor is still some time away, the trial run of the 6.5 km Metro stretch between Vastral and Apparel Park on the East-West corridor is expected some time in mid-January. There is a strong likelihood that it may coincide with the Vibrant Gujarat Summit.

LEGAL TRACKS

  • MEGA, that  is developing the Ahmedabad Metro Rail project, has issued a notice to the company, after work on the project was halted by the latter
     
  • Gujarat government recently announced that it would buy the 50% stake held by IL&FS in GIFT City to prevent delays in the project
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