Let’s examine the goals behind promoting public transport across the world, the role of governments and the methods followed by the Government of India and various state governments. In Hyderabad, the L&T company partner of the Hyderabad Metro Rail project exited before the expiry of its contract. The Telangana government, accepting L&T’s condition to bear a debt burden of ₹13,000 crore, took over the project. The Delhi Airport Express Metro project (from New Delhi Railway Station to Indira Gandhi International Airport) was built under the PPP (Public-Private Partnership) model on a BOT (Build-Operate-Transfer) basis, with Reliance Group partnering with the Delhi Metro Rail Corporation (DMRC). The total estimated cost of the project was ₹5,700 crore DMRC was to spend ₹2,850 crore on civil works like land acquisition, tunnels, stations, and depots, while Reliance was to spend ₹2,850 crore on design, supply, and installation. The contract period was 30 years, extendable by another 30. The passenger fares and non-fare revenues were to belong to Reliance, while Reliance had to pay DMRC ₹51 crore annually.
The service began on February 23, 2011, with an initial fare of ₹80. In June 2013, Reliance issued an ultimatum that it would cease operations after June 30. Consequently, DMRC was forced to take over the project, reducing the fare from ₹80 to ₹60 and continues to operate it to this day. Reliance not only abandoned the project but also filed a case demanding huge compensation from DMRC. The tribunal ruled in favor of Reliance, ordering DMRC to pay ₹2,782.33 crore. DMRC appealed to the Delhi High Court and later to the Supreme Court. In April 2024, the Supreme Court finally overturned the tribunal’s order, providing relief to DMRC. The Mumbai Metro project was also built under the PPP model with the Mumbai Municipal Corporation (holding 26%) and Reliance (holding 74%). The agreed fare range was ₹9–₹13. However, when operations began on June 8, 2014, Reliance unilaterally raised fares to ₹10–₹40. The Mumbai Corporation went to court, but the courts did not declare Reliance’s action illegal. As a result, Reliance continued to collect its self-determined fares. Later, Reliance proposed raising fares to ₹110, but the Bombay High Court stayed that move. The dispute continues.
Both of these Metro experiences involve Reliance. Now, even L&T has exited the Hyderabad Metro, transferring the responsibility to the Telangana government meaning the burden falls on the people of Telangana. Despite such bitter experiences, governments continue to aggressively pursue PPP models. PPP has become a ‘mantra’ for governments. Private companies enter to reap profits from public money, and when things don’t go their way, they violate agreements, abandon projects, or engage in litigation. The public interest hardly matters to them. Should metro rail projects really be judged on a profit-loss scale? What does the global experience say? Across the world, in 204 cities across 65 countries, 970 metro rail projects are in operation. Considering capital and operating costs together, not a single one is in profit. Public transport as a whole faces the same situation. However, a few metros like Hong Kong’s show a surplus on the operational side because they earn huge revenues from real estate developments around metro stations. Studies by India’s Ministry of Housing and Urban Affairs, UITP and CAG reveal that metro ticket fares generally cover only 30%–60% of operating expenses. The remaining costs are borne by governments. Globally, countries promote metro projects not for profit but for public welfare and long-term urban sustainability, pursuing five key goals. ‘Urban Mobility’ Convenient, reliable, high-capacity public transport reducing road congestion and travel time. ‘Environmental Benefits’ Reduced air pollution and greenhouse gas emissions. ‘Safety and Comfort’ Safer travel compared to road transport; predictable schedules; air-conditioned trains.
‘Inclusive Growth and Accessibility’ Affordable travel for middle and low-income groups better connectivity for the urban poor and women.
‘Urban Development and Economic Growth’ Development around metro stations, strengthening local economies, increasing property values and generating employment.
‘These countries are not socialist’ they follow neoliberal policies promoted by institutions like the World Bank. Yet, the Indian government measures public transport purely by profit and loss and insists on implementing every project under PPP models. This is deeply regrettable and, one might say, anti-national. This approach isn’t limited to transport. It spans all sectors. After the disintegration of the Soviet Union, globalization emerged under the guise of a unipolar world. In that wave, under Congress rule, Prime Minister P.V.Narasimha Rao and Finance Minister Manmohan Singh introduced liberalized economic policies encouraging the private sector and withdrawing the state from its public responsibilities, leaving people at the mercy of market forces.
However, in 2004, when the UPA government came to power with leftist support, it had to adopt a Common Minimum Programme and put in place certain safeguards for public sector enterprises. Since Narendra Modi came to power in 2014 under the NDA government, privatization has been given full throttle. The Prime Minister himself declared that public sector enterprises were ‘born to die’. Recently, in Visakhapatnam, Finance Minister Nirmala Sitharaman reaffirmed that ‘privatization is our policy’. Under the banner of the ‘National Monetization Pipeline’, privatization now takes a new form: infrastructure built with public money roads, railways, airports, ports, power lines, pipelines is being leased out to private players who invest nothing but reap the benefits.
In essence, the private sector is feasting at a table set by the people’s money. Should we allow this disastrous policy of transferring public assets to private hands to continue or bring it to an end? The answer lies with the people of India. It is the people who must awaken, mobilize, and demand a change in the government’s anti-public policies that is the essence of our argument.
