Hyderabad Metro Phase-1 Takeover Clears Major Hurdle!

In a significant development for Hyderabad Metro Rail, the Telangana Cabinet has approved a ₹13,615 crore loan from Indian Railway Finance Corporation to facilitate the government takeover of Phase-1 of the project. The decision paves the way for the metro to come under government control by April 30. Currently operated by L&T Metro Rail Hyderabad Limited under a public-private partnership (PPP) model, the project will now be acquired through a share purchase agreement with 100 percent equity transfer. The Cabinet also approved related agreements, including a state guarantee, undertaking letter, and loan documentation, ensuring a structured transition of ownership.

The loan will be repaid over a 20-year period, with the Telangana government providing financial backing. The total takeover cost is estimated at ₹15,000 crore, including ₹13,000 crore in debt and ₹2,000 crore in equity, with the remaining funds to be arranged by Hyderabad Metropolitan Development Authority. To ensure operational continuity, 115 employees of L&T MRHL will be retained for one year, while senior experts will assist during the transition phase. The Cabinet sub-committee also made several financial and legal recommendations, including adjustments in liabilities, indemnity clauses, and handling of pending dues and claims, ensuring a smooth and legally compliant takeover process.