DLF-IL&FS set to bag Gurgaon Metro project

A Consortium comprising Infrastructure Leasing Financial Services (IL&FS) group and DLF is all set to bag the first privately operated metro line project in Haryana. The consortium was the sole bidder for the line that would come up in Gurgaon at a cost of about Rs 1,000 crore.IL&FS group company ITNL Enso Rail Systems (IERS), together with affiliates, holds 74 per cent while the remaining 26 per cent being held by DLF.
The consortium submitted an offer to Haryana Urban Development Authority (Huda) for taking up the project on a build-and-operate basis. The bidding closed on Wednesday.Once clearances from the state and Union governments are in place, the consortium would get to operate the system for 99 years. IERS managing director and chief executive officer Sanjiv Rai said the Metro Rail Gurgaon system, a 3.2km alignment, would provide a link to Delhi Metro Rail Corporation (DMRC) Sikanderpur station in Gurgaon. DMRC is constructing a metro link to Gurgaon from Delhi.
Rai said the consortium would be paying a portion of the non-tariff revenue to Huda. The non-tariff revenue would come through lease rentals of commercial space and advertising along the line. He did not give details on the sharing of revenue citing confidentiality terms.The link, which will come up in an area that has commercial and residential properties developed by DLF, will reduce the travel time to and from the DLF Cyber City region to Sikanderpur. The system has six stations on the alignment. “The system will utilise the best available rail technology with optimal safety, reliability and will be environmentally sustainable,” Rai added.
In addition to IL&FS, Larsen & Toubro and Reliance Infrastructure had initially shown interest in the project but they did not put in bids. A Reliance Infrastructure executive said, “The Metro system was too small compared to the kind of operations we want to get into.” On the cost of construction, Rai said since the stretch is small, the consortium would not be able to take benefit of economies of scale in construction. Similar privately operated Metro rail systems have been planned in Mumbai and Delhi. Reliance Infrastructure is implementing the projects in the two cities. While the 15-km stretch in Mumbai is estimated to cost Rs 2,600 crore, Delhi’s airport link across 25 km is estimated to cost Rs 2,500 crore.