Hyderabad Metro Takeover Deadline Extended to April 30 Government Pushes Financial Restructuring

• Hyderabad Metro takeover deadline extended
• Government plans debt restructuring for metro
• L and T exit paves way for expansion

The Telangana government has extended the deadline for taking over the Hyderabad Metro Rail project from L and T until April 30, giving more time to complete key financial arrangements linked to the transition. The takeover was initially scheduled to be completed by March 31.

Officials said the delay is primarily due to pending financial restructuring, particularly the process of transferring existing loans. The government is set to take over a significant debt burden of nearly Rs 13000 crore along with an additional equity component of around Rs 2000 crore as part of the agreement.

To ease the financial pressure, the government is exploring alternative funding strategies. One of the key proposals involves raising a large portion of the loan in Japanese Yen, which is expected to substantially reduce interest costs. Currently, L and T is paying close to 10 percent interest, while the revised plan could bring it down to around 3 to 4 percent.

Sources indicate that about 75 percent of the total loan amount may be raised in Japanese Yen, while the remaining portion will be secured in Indian currency. The government has already approached the Indian Railway Finance Corporation and received in principle approval for the funding arrangement. However, the process of securing and releasing these funds is expected to take additional time, leading to the extension.

Meanwhile, the state has already cleared a resolution in the Assembly to bring the metro project under its direct control. The first phase of the Hyderabad Metro, covering nearly 69 kilometres, will be operated by Hyderabad Metro Rail Limited as a government entity once the takeover is complete.

With L and T preparing to exit the project, the government believes the transition will allow for smoother and faster expansion plans. The upcoming Phase II, which is expected to cover around 162 kilometres, is likely to benefit from unified control and streamlined decision making.

Officials are confident that once the financial restructuring is completed and the takeover is finalised, the metro system will operate more efficiently under government management while also accelerating future expansion across the city.