Hyderabad Metro Rail To Come Under Telangana Government Control From L&T | Hyderabad-news News

The government has already set its sights on completing the second phase of the Hyderabad Metro within the next three years. (Image: PTI File)

The Telangana Government has decided to take over the Hyderabad Metro Rail project from Larsen & Toubro (L&T). The decision was finalised after discussions between Chief Minister Revanth Reddy and L&T Chairman SN Subrahmanyan on Thursday.

With this agreement, the government will assume responsibility for Rs 13,000 crore in loans that L&T had taken from banks to build the project. In addition, the state will pay Rs 2,000 crore to L&T as a one-time equity settlement.

Officials said this development is crucial for the expansion of the Hyderabad Metro and once the takeover is complete, the city’s metro – currently the only one in India operated by a private entity – will also come under government ownership, just like the other 23 metro projects across the country.

The government has already set its sights on completing the second phase of the Hyderabad Metro within the next three years.

A Detailed Project Report (DPR) has been submitted to the Centre for approval and Phase 2 is expected to cover 163 kilometers across eight new corridors to meet the growing demand for public transport in and around the city.

However, the Centre had raised concerns about the split ownership of the Metro, as Phase 1 was still under L&T’s control while the state planned to execute Phase 2. It suggested an integrated management agreement for both phases.

L&T, however, declined to participate as an equity partner in Phase 2 or sign a joint operating arrangement. Instead, it proposed selling its entire stake in Phase 1 to the government, thereby transferring full ownership of the Metro to the state.

During the negotiations, L&T initially demanded ₹5,900 crore for its equity stake in addition to the transfer of existing loans. The company also cited pending dues of ₹2,100 crore from earlier agreements.

After extensive talks, the state government and L&T agreed on a settlement under which the government will take over the Rs 13,000 crore debt and pay Rs 2,000 crore to L&T.

With this decision, the government has cleared a major hurdle in the city’s Metro expansion plans. The takeover of Phase 1 will pave the way for the smooth approval and execution of Phase 2, ensuring better integration and management of Hyderabad’s public transport system.