The Mumbai Metropolitan Region Development Authority (MMRDA) has been directed by the Maharashtra Cabinet to settle the outstanding debts of the Versova-Andheri-Ghatkopar Metro One through a One-Time Settlement (OTS) with six public sector unit (PSU) lenders. This directive follows the state government’s recent reversal of its decision to acquire Metro One, initially decided in March before the Lok Sabha elections.
During a meeting held on June 26, the Cabinet instructed the Chief Secretary-led executive committee to proceed with the settlement discussions with the lenders of Mumbai Metro One Pvt Ltd (MMOPL). The strategic move aims to alleviate the financial burden by clearing the loans and avoiding further interest payments, thereby easing financial stress on the project. The plan entails MMRDA settling the loans taken by Metro One from six lenders, with the recovery of costs to be managed through the operational revenues of Metro One. This approach not only prevents additional interest payments but also eliminates the necessity of acquiring Metro One.
Metro One experiences an average daily footfall of approximately 4.5 lakh passengers, generating an estimated ₹1 crore daily from ticket sales. Additional revenue streams include non-fare box income from advertisements and leasing space. In March, MMOPL had entered into a debt settlement agreement with its lenders, agreeing to a one-time settlement of ₹1,700 crore to cover its entire debt. As part of this settlement, MMRDA and MMOPL made an upfront payment of ₹171 crore. The state cabinet has now mandated MMRDA to expedite this settlement process.
MMRDA Commissioner will convene meetings with the six lenders, which include State Bank of India, IDBI Bank, Canara Bank, Indian Bank, Bank of Maharashtra, and IIFCL (UK), to finalise the debt settlement terms. This move follows a period between April 2023 and June 2024, during which MMOPL has paid over ₹225 crore in interest to its lenders. The debt clearance strategy is designed to leverage Metro One’s operational revenues to repay the loan, effectively nullifying the need for the MMRDA to bear interest costs. This proactive financial management plan aims to stabilise Metro One’s economic footing and ensure the continued smooth operation of the service.
