Budget 2018: Jaitley Reduces Metro Projects Allocation By 20%

Budget 2018: Jaitley Reduces Metro Projects Allocation By 20%

Budget 2018: Jaitley Reduces Metro Projects Allocation By 20%

The intentions of the Narendra Modi-led government to shape the country's infrastructure was crystal clear from the Budget Speech delivered by Finance Minister Arun Jaitley on February 1. “In order to create employment and aid growth, government's estimated budgetary and extra-budgetary expenditure on infrastructure for 2018-19 is being increased to Rs 5.97 lakh crore against the estimated expenditure of Rs 4.94 lakh crore in 2017-18,” the FM announced.

Commuters of two major metropolis — Mumbai and Bengaluru were given a bonanza in the form of new the suburban networks in both the cities. However, Budget 2018 came as a disappointment for the Mass Rapid Transit System (MRTS) and Metro projects as allocation for the financial year 2018-19 were 20 per cent lower than what was outlaid in the last fiscal. The total capital outlay for all metro projects in the country is Rs 14,264.60 crore, a reduction of approximately Rs 3,000 crore lesser than the figures in Budget 2017-18.

MakaaniQ delves deeper to analyse the impact of this decision:

The bigger picture

The amount of fund allocated for Metro projects in Budget 2017-18 was Rs 17,810 crore, while in 2016-17 this number stood at Rs 15,326 crore.

It might seem that the priorities of developing Metro projects in key cities such as Pune and Kochi have taken a backseat. However, the government is aware that the infrastructure sector is in dire need of huge investments — an estimated worth of over Rs 50 lakh crore for the growth — and integration of the nation with a network of roads, airports, railways, ports and inland waterways. And, development of Metro projects in various parts of the country is in full progress. There are expansion projects in Delhi, Bengaluru, Chennai, Pune and Greater Noida.

As the funds were allocated, no break-up for the individual Metro projects such as the ones undertaken by the Delhi Metro Rail Corporation (DMRC). Although a grant of Rs 50 crore to the Delhi Metro for its expansion into the National Capital Region (NCR) areas was also proposed. Last year, the DMRC was granted Rs 150 crore for Metro expansion into the NCR areas.

The sanctioned cost for the Phase-III project, including extension to Haryana and Uttar Pradesh, stands at Rs 44,816.91 crore, according to the DMRC.


Reports suggest that Pune Metro project alone was looking for an allocation of Rs 15,000 crore to develop the route, especially the recently approved Line 3. However, the said amount has been all that the ongoing Metro projects in India will be given this fiscal.

This might cause a delay in the timelines set for the projects for this year. This will further have a rippling effect on the timeline set for these projects to get operational.

New Metro rail policy

Metro projects across several cities are at various stages of planning and appraisal. For instance, Maharashtra has a planned Metro rail network spanning 350 kilometres covering three cities, including Mumbai, Nagpur and Pune. Three proposed Metro rail projects, one each in Agra, Kanpur and Meerut, also received approval by the Chief Minister of Uttar Pradesh.

Recently, the new Metro rail policy under the Make in India Scheme received the clearance of the Cabinet. Designed by the Urban Development Ministry, the policy will help meet the goals of Metro rail development in these cities. Under the new policy, states will be empowered to set rules and regulations, revise fares and promote urban development along the Metro corridors.

Last Updated: Mon Feb 12 2018

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