The Maharashtra government has embarked on discussions to potentially acquire Reliance Infrastructure’s (RInfra) Mumbai Metro Line 1, following the corporate entity’s recent legal entanglements.
RInfra, grappling with a setback in the Supreme Court, faces the prospect of returning approximately ₹8,000 crore to the Delhi Metro Rail Corporation (DMRC). In light of this development, the state government has initiated talks to take over the operational reins of Mumbai’s vital metro infrastructure. Presently, negotiations with lenders are underway as part of the acquisition process, a critical step toward assuming control of the metro system. Notably, the Mumbai Metro Line 1 project was the first of its kind in India to secure financing from six domestic banks, including Canara Bank, IDBI Bank, and State Bank of India. While two lenders, State Bank of India and IDBI Bank, previously pursued insolvency proceedings, the matter has since been resolved through a One-Time Settlement (OTS) facilitated by all creditors.
Under the acquisition framework, the settlement of lender dues takes precedence, followed by government liabilities, employee salaries, and other obligations. RInfra’s equity payment, if any, would be addressed subsequently. Furthermore, the proposed acquisition, spearheaded by an independent committee chaired by former bureaucrat Johny Joseph, evaluates RInfra’s stake in the metro line at approximately ₹4,000 crore. Despite RInfra’s claim of significant construction expenditure, discrepancies persist between the private and government entities regarding project costs and revenue allocation. The Mumbai Metro Line 1, spanning from Versova to Ghatkopar, serves as a vital East-West transit link, catering to over 4.6 lakh passengers daily. As discussions progress, the government remains committed to resolving operational challenges and ensuring the seamless functioning of this critical transportation artery in India’s financial capital.
