Hyderabad: Chief Minister A. Revanth Reddy is to tell the Centre during his ongoing visit that delay in releasing the Rs 13,527-crore Indian Railway Finance Corporation (IRFC) loan for Hyderabad Metro Rail was imposing an additional interest burden of nearly Rs 2.5 crore per day on the state government, sources said on Sunday.
Sources said the CM’s visit is focused on securing the early release of the IRFC loan for Hyderabad Metro Rail (HMR) and pursuing other pending issues with the Centre, including the ongoing Raidurg land auction dispute involving the State Bank of India (SBI).
Sources said Revanth Reddy reached Delhi from Mumbai and will camp in the Capital till June 23. He has sought appointments with Union Finance Minister Nirmala Sitharaman and Union Railway Minister Ashwini Vaishnaw to press for the immediate disbursal of the IRFC loan.
The Chief Minister visited Mumbai on Saturday to attend the wedding of Revati Sule, daughter of Lok Sabha member Supriya Sule, and stayed there overnight. Sources said he attempted to meet Maharashtra Chief Minister Devendra Fadnavis to seek cooperation for construction of the Tummidihatti barrage under the revived Pranahita-Chevella project on the Godavari river. However, the meeting could not take place due to Fadnavis’ prior engagements.
The delay in operationalising the IRFC loan agreement has become a major concern for the state government. More than three weeks have passed since the tripartite agreement was signed, but the funds have not been released. While the exact reasons remain unclear, the state government has indicated that the delay is significantly increasing its financial burden.
As part of the HMR takeover agreement signed on April 29, the government paid Rs 1,461 crore as equity to acquire 100 per cent shares from L&T and agreed to take over the project’s outstanding debt of Rs 13,538 crore. Since the existing loans carried higher interest rates, the government decided to refinance them through the IRFC.
Accordingly, a tripartite agreement was signed in Delhi on May 25 among HMR Limited, L&T Metro Rail (Hyderabad) Limited and the IRFC. The state had expected the loan to be released by May 30, enabling the metro’s first phase to formally come under government ownership from June 1 and substantially reduce interest costs.
The delay has resulted in mounting liabilities. Since the takeover agreement was signed on April 29, the state government has been servicing the interest on the existing debt. Officials initially estimated that the interest burden would be around `80 crore if the refinancing process was completed within 30 days. With the loan still pending, the burden has now crossed `130 crore.
Sources said Telangana accepted all conditions imposed by the IRFC, including providing a state guarantee and permitting direct recovery of loan instalments through the Reserve Bank of India mechanism in case of repayment defaults. The tripartite agreement was signed only after these conditions were accepted.
When the loan was not released by the end of May, Revanth Reddy met Union minister Manohar Lal Khattar in Delhi earlier this month and sought support for both Hyderabad Metro Phase-II approvals and the release of the IRFC loan. Despite the intervention, the funds remain pending.
Officials said the IRFC approved the refinancing proposal after six months of discussions, taking into account metro revenues from ticketing, advertisements and rentals. However, sources said the IRFC has neither communicated reasons for the delay nor sought additional information from the state, though officials reportedly indicated that final clearance from the railway ministry is still awaited.
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