Delhi Metro gets its first train from controversial Hyundai contract

DMRC will have to use the coaches as it was advised against cancelling the contract

Months after expressing displeasure over the Rs 4,600-crore contract with South Korean Hyundai Rotem for supply of coaches, Delhi Metro Rail Corporation (DMRC) has received its first train as part of the controversial deal. 

The train, manufactured at Changwon in South Korea, arrived at Mundra port in Gujarat and was brought to Delhi on special trailers. It reached DMRC’s Mukundpur Depot Thursday.

DMRC would have to use the Hyundai-supplied 81 train sets (486 coaches) as it was advised by the government and Attorney General Mukul Rohatgi against cancellation of the contract. 

“Yes, the same coaches have arrived under the Hyundai contract,” a DMRC spokesperson confirmed, adding that these trains will cater to the requirements of the upcoming 58 Kilometer Majlish Park – Shiv Vihar corridor and 38 Kilometer Janakpuri West – Botanical Garden corridor of Phase III, both of which are expected to be operational by the end of 2016.

DMRC had awarded Hyundai Rotem the mega contract in April 2013. The metro operator had late last year said it had come to its notice that Hundai Rotem had, in its tender submission to DMRC against the Rolling Stock tender related to the Phase-III project, concealed the fact that it had been barred by a government agency. 

DMRC had then sought the opinion of the country’s highest law officer after finding Hyundai, in violation of tender conditions, allegedly withheld information of being blacklisted by another Indian government agency, the Airports Authority of India (AAI). AAI had in 2011 barred Hyundai Rotem from bidding for its contracts till December 13, 2014.

DMRC was advised that cancelling the contract at this stage might not be in public interest — though there are several provisions for Hyundai’s disqualification — as huge amounts, including Rs 670 crore against advance payments, have already been paid to the company, in addition to another Rs 177.64 crore. Besides, production is in full swing and the first train was likely to reach in March.  

The A-G was reportedly informed that cancelling this contract would mean non-use of capital assets to the tune of Rs 25,000 crore, including stations and tunnels, and the entire Phase-III of DMRC would be delayed; unutilised inventories would be prone to thefts, apart from huge inconvenience to the public. 

Earlier, the urban development ministry had also argued that cancelling the tender would delay the project by two years. Rules of the tender, as well as conditions laid down by the funding agency, Japan International Cooperation Agency (JICA), say the contract will be cancelled if at any stage it comes to light that a company had secured the contract by furnishing fraudulent information. DMRC had earlier told Business Standard it will take suitable action Hyundai Rotem.

The Phase-III project is to add 140 km to Delhi Metro’s existing network and close to 1.5 million passengers to its daily users. When it becomes fully operational in the next two years, the Metro’s network will reach faraway areas including Badli, Bawana, Najafgarh, Bahadurgarh, Ghaziabad, Faridabad and Noida, apart from a few landmark destinations like the domestic terminal of the IGI Airport and the Red Fort.