Hyderabad Metro Rail Phase 2 Gets ₹125 Crore Boost; Takeover from L&T Targeted by March 2026
Telangana sanctions ₹125 crore for Hyderabad Metro Phase 2, with the state government set to take over operations from L&T by March 2026.
Telangana government moves closer to Hyderabad Metro Phase 2 expansion as the takeover from L&T is targeted for completion by March 2026.
Telangana CM Revanth Reddy's government has made a remarkable move to grow the Hyderabad Metro Rail network. The project Phase 2 has been approved with an administrative sanction of ₹125 crores, and the Chief Secretary Ramakrishna Rao has issued the formal orders. The extension of the Metro services to the Old City is the main goal of the expansion, and it will be executed as a partnership.
In the course of the proceedings, Chief Secretary Ramakrishna Rao presided over a high-level steering meeting on the Hyderabad Metro Rail project. The meeting was attended by the Secretaries Committee's officials and L&T's representatives. Rao informed that the transfer procedure should be governed by the previous agreements and pointed out the urgency of completing all the scheduled activities in 100 days. He also instructed officials to finalise the transaction advisor IDBI Bank’s report at the earliest.
Hyderabad Metro Rail Takeover Deadline Set
The Chief Secretary instructed the officials to finish the process of taking over the Metro Rail operations in Hyderabad from L&T at the end of March 2026 and to produce unambiguous rules for the process to be foolproof. He called upon L&T to give its full support in order to comply with the time limit. The state authorities intervened to seize the project after L&T signified that it would not be able to run the Metro anymore.
On September 25, L&T publicized its decision to leave Phase 1 of the Metro project. The state government basically agreed to compensate L&T’s equity input in a single payment of ₹2,000 crores, and at the same time, take over the Metro operation debts of ₹13,000 crores. This would cut short the duration of Phase 2 works and the state would be able to receive the approvals required from the Central government sooner.
The Centre has reiterated that a binding agreement with L&T is the pre-condition for a smooth connection between Phase 1 and Phase 2. While the state government proposed a joint venture with L&T for Phase 2, the company clarified that it cannot participate as an equity partner in Phase 2A and 2B. L&T has expressed readiness to transfer its equity stake to either the state or Central government, paving the way for the state’s takeover.
