RInfra pulls out of Delhi airport line; DMRC to take over operations

Written by fe Bureau | New Delhi | Updated: Jun 29 2013, 09:52am hrs
With the Reliance Infrastructure-led Delhi Airport Metro Express (DAMEPL) refusing to accept the Delhi Metro Rail Corporations (DMRC) request to continue with its operations on the Delhi airport line, the project seems headed for a lengthy legal battle. DAMEPL on Thursday served a termination notice on DMRC saying it would stop operating the airport line from the night of June 30.

DMRC on Friday said it was ready to take over the airport express line in case the operator wanted to pull out. After an emergency meeting to decide the fate of the line, secretary for urban development and DMRC chairman Sudhir Krishna said the board had concluded that the notice was in violation of the concession agreement and the ongoing arbitration proceedings.

The board decided to reject the notice and call upon them to continue the operations of the line in terms of the agreement. If, however, they do not do so, DMRC shall step in and operate the line in larger public interest, Krishna said. DMRC has taken the stand that the premature withdrawal of the company from the project would attract a hefty penalty.

Services on the airport line were shut in July last year for a few months as 90% of the bearings on the line were found to be faulty, for which a fact-finding committee had held DMRC responsible. Since then, DMRC and DAMEPL have been at loggerheads over the line. The 23-km express line was built at a cost of R5,700 crore.

RInfra, meanwhile, has been sticking to its charge that the line has severe faults and is financially unviable. An RInfra spokesperson said, In October 2012 we had served a termination notice to DMRC which it disputed, following which the matter went into arbitration. DMRC, at the time, said it would rectify the faults related to civil construction on the line at the earliest, after which the line was reopened on January 22, 2013, after a gap of six months. However, after running the line for six months it was realised that the arbitration was not making progress and so we issued a termination again on June 27, 2013.

DAMEPL has been struggling to run the line since operations were launched in February 2011 since it was incurring losses. The entity is a special purpose vehicle between Reliance Infrastructure (95%) and CAF, Spain (5%) based on a build-own-operate-transfer basis. DMRC had built the civil structure on the line and the Anil Ambani group company takes care of operations and maintenance with the concession agreement of 30 years.

DMRC said DAMEPL had been regularly sending notices to terminate the concession agreement signed between the two, thereby exiting the corridor. The airport express line claimed a run time of 18 minutes from New Delhi Railway Station to Terminal 3 of the Indira Gandhi International Airport and had a daily ridership of about 15,000 passengers.