Delhi Metro: Covid has deprived us of Rs 1,500-cr revenue, need recast of JICA loan, says DMRC’s Mangu Singh

August 26, 2020 12:13 PM

Non-passenger revenue in FY18 was Rs 536 crore and this improved in FY19 to Rs 594 crore which includes income from rental, lease as well as consultancy-related sources.

The losses that will be there at the end of the fiscal will depend on when we start the operations, the level of the traffic, how the Covid recedes, etc.The losses that will be there at the end of the fiscal will depend on when we start the operations, the level of the traffic, how the Covid recedes, etc.

Five months into the shutdown of the National Capital Region’s Metro rail services in the wake of the efforts to combat Covid, Delhi Metro Rail Corporation (DMRC) managing director Mangu Singh speaks to Nivedita Mukherjee of FE on challenges being faced by the entity and shares his optimism about reviving the Metro’s fortunes:

Delhi’s chief minister has joined the chorus in favour of opening up Metro. What is your view on that?

We have been carrying out trial runs of the trains. As far as resumption of operations are concerned, just two days are needed for a thorough cleaning of the stations. We are taking up the necessary cleaning inside the trains and indoor areas of stations such as entrance lobbies, corridors, staircases, escalators, elevators, security area, etc.

Do you think the crowds will be back given the uncertainty over Covid-19?

There will be a setback. In the present scenario, people are more concerned about their health and safety, and those who can afford a personal vehicle are choosing that option. But we believe that once the pandemic abates and there is a solution, there is no alternative to the public transport experience offered by Delhi Metro.

Social distancing and creating that level of confidence will be our priority. For that we have prepared a very detailed SOP under the guidance of the ministry of urban development and DMRC has played a very important role in that. We have decided not to open all the gates of the stations and if we find more number of people inside the stations or there is crowding in the coaches, we will regulate the passengers at one gate. Necessary logistical arrangements such as provision for hand sanitisation, thermal screening at stations and installation of social distancing related signages are also being handled in the interim.

Besides this, we are taking new initiatives which will benefit commuters whenever Metro services resume. Passengers will be able to avail the facility of a new type of smart card which will offer auto top-up functionality whenever the value of the smart card goes below Rs 100 and will automatically recharge the card with `200 at the Automatic Fare Collection entry gate itself.

What has been the impact of the lockdown on Metro operations and finances?

We were carrying almost 60 lakh people on a weekday before the lockdown. But as the situation stands now, whenever we reopen, that kind of crowd will not be there. Occupancy will be around 25-30 %.

In terms of finances, the impact is harsh. We used to earn about Rs 10 crore per day from ticket sales before the lockdown. That has completely dried out. Our losses after 150 days since the Metro shut is nearly Rs 1,500 crore. The losses that will be there at the end of the fiscal will depend on when we start the operations, the level of the traffic, how the Covid recedes, etc.

Are you able to service the loan taken from Japan International Cooperation Agency?

Of the entire earnings of the DMRC, one of the major expenditures is the repayment of the loan from JICA. The total loan is more than Rs 30,000 crore. The interest on JICA loan to the tune of Rs 79.19 crore has been paid till now in the current financial year by DMRC. Balance Rs 1,163.64 crore (Rs 354 crore on account of interest and Rs 808.68 crore on account of principal) is to be paid during 2020-21. Since we have no revenue, we have requested the government to arrange for deferment of the loan payment.

Making Metro profitable has become a bigger challenge post-Covid-19, hasn’t it?

There is frankly not much scope of significant scaling up where revenues are concerned.

In FY19, the earning from passenger segment was Rs 3,121 crore, up from Rs 2,616 crore in FY18. Non-passenger revenue in FY18 was Rs 536 crore and this improved in FY19 to Rs 594 crore which includes income from rental, lease as well as consultancy-related sources. All the retail agencies using the Metro real estate have said they can’t pay to DMRC and are also asking for some relief. We will have to consider this and may have to work out a reasonable package so that they remain with us or else we will be in a situation where even the income we get will dry off. Fare revision will not play an important role in terms of attracting commuters as the consideration affecting travel is not monetary but health.

What is the progress on various projects?

There are three approved priority corridors in Phase IV of the DMRC. Despite issues such as unavailability of adequate labour force, DMRC has been moving ahead with construction work of all the three corridors. Under this phase, 61,679 km of new Metro lines shall be constructed across three different corridors comprising 45 Metro stations.

Much of the labour has now come back – about 70-80%. The one good thing that has happened in this lockdown period is that we have fully utilised the digital platform to bring together a consultant who is sitting in the UK and the manufacturer of a machine elsewhere and work on drawing and designing which will help to speed up projects.

What is DMRC’s role in the Atmanirbhar Bharat campaign?

In Phase 4 of DMRC projects, we have Chinese presence but not significant. They have a minor role. Our major partners in the joint venture are local players. I am proud to say that DMRC has since inception followed policies and working methods to boost indigenisation by making it mandatory that whosoever is the supplier for coaches will have to put up a factory in India and manufacture here.

We have three manufacturing units in India and our Metro coaches are meant not only for domestic consumption but also for export to New Zealand. The ministry of urban development has asked all Metros in India to list items for which we are dependent on imports. We have done that and put down our requirements for next five years and are now approaching companies across the world and asking them to come make their units in India.

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