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Telangana Chief Minister A. Revanth Reddy on Monday accused the Central government of not honouring its earlier commitment to participate as a joint venture partner in the second phase of the Hyderabad Metro Rail project. He said that if the Centre was unwilling to contribute its share, the Telangana government was prepared to take up the project entirely on its own with 100% funding.
Hyderabad Metro Phase 2 Funding
Speaking to reporters at the Secretariat, Revanth Reddy urged the Centre to immediately issue a No Objection Certificate (NOC) for Hyderabad Metro Phase-2 so that construction work could begin without further delays.
The Chief Minister said he had met Narendra Modi and Union ministers Manohar Lal Khattar and Ashwini Vaishnaw several times to seek approval for the metro expansion project, which has been pending for years.
According to him, the Centre had earlier agreed to fund 50% of the project cost after Larsen & Toubro, which developed the first phase of the metro, declined to participate in Phase-2 due to financial losses. He said the company had created metro assets worth around ₹30,000 crore but was reportedly suffering annual losses of about ₹400 crore. L&T had also expressed unwillingness to continue future operations and maintenance responsibilities.
Revanth Reddy explained that based on the Centre's advice, the Telangana government took over the Phase-1 project for about ₹15,000 crore. To repay L&T's outstanding bank loans of ₹13,600 crore, the state arranged a loan from a Japanese agency through Indian Railway Finance Corporation at a lower interest rate of 4%, compared to the existing 8.25%.
However, he alleged that the Centre later blocked the transfer of this loan to the state government despite all approvals being in place. He said Telangana had already paid ₹1,400 crore and had also obtained approval from the Reserve Bank of India.
Central Government Failed to Grant Clearance
The Chief Minister further claimed that the funds were supposed to be released on Monday, but the Centre had not granted clearance. He alleged that Union minister G. Kishan Reddy influenced the decision to delay the release.
Revanth Reddy also questioned why the Centre was preventing Telangana from obtaining a lower-interest loan when it had previously approved loans worth ₹3.15 lakh crore for the former state government through financing agencies at much higher interest rates. He further accused the Centre of treating Telangana unfairly while approving metro rail projects in cities such as Ahmedabad, parts of Uttar Pradesh, and Visakhapatnam.
The Chief Minister reiterated that if the Centre does not provide its 50% share for Hyderabad Metro Phase-2, Telangana is ready to fund the entire project itself. However, he stressed that the Centre must at least issue the required NOC so that the expansion can move forward.