Hyderabad, May 25 (IANS) In a major financial boost to Hyderabad Metro, the government of Telangana has secured up to Rs 13,600 crore term loan refinancing facility from Indian Railway Finance Corporation Ltd (IRFC).

The state government termed it a significant step towards strengthening Hyderabad’s urban mobility infrastructure.

The agreement was signed on Monday between IRFC, Hyderabad Metro Rail Limited (HMRL) and L&T Metro Rail (Hyderabad) Limited (LTMRHL) in the presence of IRFC CMD & CEO Manoj Kumar Dubey and Telangana Chief Secretary K. Ramakrishna Rao in New Delhi.

This comes a month after the state government formally acquired Hyderabad Metro Rail Phase I from Larsen & Toubro Limited for Rs 1,461 crore.

As per the agreement signed last month, the debt of LTMRHL, amounting to Rs 13,538.53 crore, as on April 30, which was guaranteed by L&T, has to be refinanced with a guarantee issued by the Telangana government.

The refinance support of Rs 13,600 crore from IRFC will be used to refinance existing debt obligations, including non-convertible debentures, commercial papers and working capital loan. The arrangement will provide an orderly exit to existing lenders and significantly improve the long-term financial sustainability of the Hyderabad Metro project, said an official release here on Monday.

The facility has been structured over a 20-year tenure with quarterly repayments. It replaces higher- cost debt with competitively priced long-term rupee financing.

The transaction is supported by an unconditional and irrevocable undertaking by the Government of Telangana for servicing all dues payable to IRFC, a State government guarantee and an RBI-backed direct debit mandate.

Hyderabad Metro Rail Phase-I, spread over 69.2 kilometres across three corridors with 57 stations, is among the largest metro rail projects developed under the public-private partnership model. The network currently caters to over 5 lakh passenger journeys daily and has emerged as a key pillar of sustainable public transportation in Hyderabad.

This refinancing support is expected to strengthen the project’s financial viability and enable the government of Telangana to accelerate the planned expansion of Hyderabad Metro, including new corridors, improved connectivity to emerging growth areas and enhanced last-mile connectivity across the metropolitan region.

Chief Secretary Ramakrishna Rao said Hyderabad has emerged as one of the major growth engines of India, and strengthening metro connectivity is essential to support the city’s rapid economic expansion, reduce traffic congestion and improve the quality of urban life.

He said the refinancing support from IRFC would provide major financial relief to L&T Metro Rail (Hyderabad) Limited and place the project on a stronger long-term financial footing.

The Chief Secretary said the arrangement would help reduce the financial cost, improve financial flexibility and support the Government’s plans for future expansion of the Hyderabad Metro network.

–IANS

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