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Metro Rail slashes Phase II estimate by ₹7,000 crore

In a huge development, the Chennai Metro has drastically cut down the estimate of its Phase II project by nearly ₹7,000 crore. From an initial estimate of ₹69,180 crore for 118.9 km, the project cost has been brought down to ₹62,000 crore, highly placed sources told The Hindu.

The Union Ministry of Housing and Urban Affairs (MoHUA) has directed Chennai Metro Rail Limited (CMRL) to reduce the project cost, as it deemed it to be very high, the sources said. Over the last year, CMRL officials held several rounds of discussions with MoHUA officials to find ways to bring down the project cost.

“It was an extremely challenging and tough process, but we managed to do it. It was very difficult as Bhopal Metro Rail was set as the benchmark for calculating cost per kilometre for the project. It may not be right to compare Chennai with Bhopal, as the purchase price of raw material and labour will be different,” a source said.

A slew of changes made in land acquisition and systems and operations helped in bringing down the cost by about ₹7,000 crore. “The MoHUA also gave recommendations on pricing for some of the systems, and changes were made accordingly,” another source said.

The final revised cost of the project will be sent to the MoHUA, after apprising the State government. After it approves the final cost, a few minor modifications will be made in the detailed project report as well, the source added.

Funds in phases
Sources said the Centre was likely to release funds in phases for Phase II, as requested by the State government.

Source
The HIndu
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