1. Mumbai Metro: Underground project cost may be 30% higher

Mumbai Metro: Underground project cost may be 30% higher

The 33.5-km-long stretch, which was envisaged in the initial DPR prepared by RITES in 2011 to be a Rs 23,136-crore project, could now cost well close to Rs 30,000 crore

By: | Mumbai | Published: January 4, 2016 12:42 AM

The final project cost of Mumbai’s first underground metro may turn out to be about 30% higher than what was envisaged in the initial DPR (draft project report) prepared by RITES in 2011.

The 33.5-km-long stretch, which was earlier slated to be a Rs 23,136-crore project, could now cost well close to Rs 30,000 crore. Senior officials in MMRC (Mumbai Metro Rail Corporation), state authority implementing the project, say that the block estimates for the project were prepared on the basis of the estimates taken by DMRC (Delhi Metro Rail Corporation) for its underground project in 2011, as there was no benchmark available for such a project in Mumbai.

However, the DPR did not pencil in the differences that may arise due to variance in the specifications of the Mumbai and Delhi projects.

The difference in cost of the project has come into fore after reports that the bids submitted by companies for civil work are about 35% higher than the estimates made by government authorities for the project.

Ashwini Bhide, managing director, MMRC, said that the DPR for the underground section of the Mumbai metro was prepared in October 2011, about 10 months after Delhi Metro had formed estimates for its project in Delhi. “At the time, only 10% escalation in cost due to passage of time between the two DPRs was considered. As there were no drawings, designs or any other benchmarks available for a project of this nature in Mumbai, the DPR relied on just the block estimates,” she said.

However, it was only after the general consultant was appointed and indicative drawings and designs were made, the differences in specifications were known, she added. AECOM Asia Company-led consortium was appointed as a general consultant for the project in 2014.

“With the information available, there was a possibility of revising the cost estimates for the project, however, due to lack of availability of benchmark and to ensure competitive bidding process, it was decided the value be left to market discovery. There are various ways in which tendering of a project can be done, and this was one such way that was found fit for a project which is first of its kind in Mumbai,” Bhide said. She refused to comment on the quantum of increase.

According to Bhide there are 28 items which differentiate Mumbai project from that of Delhi. For instance, in Delhi, the stations were designed for 6-coach trains, however, in Mumbai 8-coach trains will be run, which means increase in station length. “The length and depth of tunnels in Delhi is 10-15 metres, while in Mumbai we will have to go for 20-25 metres, also the mud dumping grounds are just 10-15 kilometres distance from the project sites in Delhi, whereas in Mumbai, we have to go 55 km away,” she added.

Bhide said MMRC will not be completely relying on the bid amounts quoted by the companies, and the process of evaluating the bids is taking place under the supervision of JICA (Japan International Cooperation Agency). She also said that the delay of about a month or two in awarding of contracts will not delay the project. “We are utilising this time to get all the right of way, so that once the work starts there are no hindrances”.

Once completed, the underground metro project will provide a crucial link between south Mumbai’s commercial centres Colaba, Nariman Point to upcoming business district of Bandra Kurla Complex (BKC) and towards Andheri in the north of Mumbai. The central and state governments have equity participation in the project, with 14% and 18% stake respectively. The rest of the amount will be funded by JICA by way of a loan. Bhide said JICA is completely involved in the implementation of the project, and there will be no funding constraints, even with project cost increase.

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