Telangana Chief Minister A Revanth Reddy has written to Union Ministers G Kishan Reddy and Manohar Lal Khattar following meetings on June 23 and June 24, urging prompt action on Hyderabad Metro Rail Phase II and the takeover of Phase I by the state government. The letters referred to talks with the Railway Minister and the Union Housing and Urban Affairs Minister and said the matters require an integrated approach urgently.

SBI Capital Markets Limited (SBI CAPS), an agency empanelled by the Government of India, was agreed to be entrusted with valuation and financial examination of Phase I to facilitate its takeover. SBI CAPS will also examine refinancing options for existing high-cost Phase I debt and review financing structures for Phase II, including long-term debt and funding arrangements. He asked the Ministry of Housing and Urban Affairs to draft Terms of Reference covering valuation, refinancing and future debt-raising needs for both phases.

The state has nominated the Special Chief Secretary of the Municipal Administration and Urban Development Department as the nodal officer to coordinate the exercise. Mr Reddy noted that, despite the agreement to entrust SBI CAPS, the assignment has not been made and the Terms of Reference have not been finalised or communicated. He warned the prolonged takeover process for Phase I is creating operational uncertainty, day-to-day challenges and affecting sanction of Phase II detailed project reports and tying up funding.

The chief minister said delays are likely to increase the cost of Phase II due to time overrun and escalation and urged Union Ministers to intervene with the concerned ministries to ensure the assignment is entrusted and the Terms of Reference finalised. He asked that decisions from the discussions be implemented expeditiously to bring the Phase I takeover to a conclusion and allow Phase II expansion to proceed.