Countdown to 2010

Construction work on the Mumbai Metro is to begin in October, with the launch set for 2010.

A 21-minute ride from Versova to Ghatkopar! Most Mumbaikars would set aside a cool 90 minutes to negotiate a route criss-crossing some of the city's most dense industrial and residential suburbs. On a bad day it can take upto two hours to negotiate this 11 km stretch.

The Reliance Energy (REL) led consortium, which won the bid to build and operate the first corridor of the ambitious Metro rail between Versova and Ghatkopar, has promised to deliver a quick, smooth and air-conditioned ride between these destinations in the city every four minutes with a passenger density of eight persons per sq ft, and a built-in redundancy of 40 per cent, by 2010.

The landed cost of the 11 km route has been estimated at Rs 2,365 crore with the government providing a viability gap funding of Rs 650 crore, almost half the initial estimate of the Anil Ambani flagship company.

The debt-equity ratio would be in the range of 70:30 to 60:40, an REL official involved with the negotiations said. Assuming it is in the 70:30 ratio, of the Rs 2,365 crore, Rs 184 crore will be the equity (26 per cent) brought in by the government through the Mumbai Metropolitan Regional Development Authority (MMRDA), with REL bringing in Rs 524 crore, a city official explained. The rest, Rs 1,657 crore, is the debt component, which the company expects to tie up by the end of October this year.

"We have taken on more risk than we had projected in the initial bid," says an REL official. The biggest risk for the consortium comes from aggressive projection of passengers.

"We had initially estimated a passenger flow of less than 1.5 lakh passengers a day, given the conversion rate (of passengers) to metros worldwide. But later we decided to take more risk "" and revised our estimates to 5 lakh passengers a day," the official said, adding: "If necessary, we will even bring in more equity."

REL expects that the project will be completed in four years "" by 2010, including six months of full testing.

The company will float a special purpose vehicle for the project in which REL, MMRDA and Connex will hold stakes, with REL developing the project and Connex running the day-to-day operations.

Connex runs metro services in cities like Sydney and is the leading private European operator for rail transport services. REL has also roped in Hong Kong's MTR Corporation as a part of its consortium, which runs the only profitable metro rail service in the world and has also consulted on the Delhi Metro.

The REL team is already talking to rolling stock vendors like Kawasaki, Alsthom, Siemens and Bombardiers for design and manufacture of the rolling stock for the metro.

Having signed the Letter of Intent (LOI) with the MMRDA, REL is slated to begin construction post monsoon in October. The company is negotiating with construction companies like L&T, Gammon, Punj Llyod and Afcons "" all veterans of the Delhi Metro "" for the civil works on which the elevated track will run.

An REL official explained that the entire system will be a state-of-the-art automatic train protection (ATP) system with an automated signalling system.

Bottomline: get ready for a safe, smooth ride.