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Telangana Chief Minister Revanth Reddy’s decision to take over Hyderabad Metro Rail is indeed a daring step. To understand why, we need to go back to the beginning.
Hyderabad Metro was originally meant to go into the hands of Maytas. But after the Satyam scandal, Maytas collapsed and couldn’t handle the project. That’s when L&T stepped in. The then CM Y.S. Rajasekhar Reddy was generous enough to agree to provide Viability Gap Funding and also allocated valuable land parcels. That set the ball rolling.
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L&T borrowed heavily, and work moved forward as per schedule. Then came the state bifurcation and KCR’s arrival on the scene. He demanded changes—like building an underground line near the Assembly and realigning the route at Sultan Bazaar. These interruptions stalled the project for almost a year, causing costs to balloon.
Once operations started, the Metro saw modest profits and at one point was ranked second in the country. But where it really failed was in exploiting its assets—station premises, properties, stalls, and commercial spaces. Poor execution gradually pushed it into losses. Today, Hyderabad Metro has slipped to ninth place among Indian metros. L&T was largely responsible for this decline.
When Revanth Reddy came to power, he envisioned a massive expansion. Plans include extending the Metro up to Hayathnagar on one side, Shamirpet on another, the international airport at Shamshabad, and bridging the Nagole–LB Nagar gap. Together, Phases 2A and 2B would take the network to nearly 160 km. With this expansion, the current ridership of about 5 lakh passengers could easily rise to 10–15 lakh. That would make Metro operations profitable while also easing city traffic congestion, pollution, and peak-hour rush.
But L&T dug in its heels and refused. The Centre too insisted that both Phase 1 and Phase 2 had to be under the same operator, otherwise there could be complications. Since November last year, expansion approvals have been stuck in a deadlock.
Meanwhile, L&T started playing pressure tactics on Revanth Reddy—planting stories in the media about existing losses, claiming Phase 2 would only add more losses, and hinting they were ready to exit. Revanth saw through this and began countering in his own style.
For him, public transport should remain in the public sector. Most metros in India are government-run. Delhi Metro is profitable—so why should Hyderabad Metro run into losses? His answer: poor management by L&T. He bluntly told them, “If you don’t agree to expansion, sell Phase 1 itself.” L&T claimed its assets were worth ₹20,000 crore.
Revanth responded, “Fine, put it up for open bidding. Whoever offers the highest price, my government will match it and buy it out.” Cornered, L&T found itself in a tight spot. A government-commissioned deep study meanwhile revealed that L&T Metro’s real worth wouldn’t even cross ₹15,000 crore. Discussions between the government and L&T have been ongoing on this front. So, the takeover idea didn’t suddenly emerge—it’s been in the works for a while.
Ultimately, government is supreme. Political decisions are final. Revanth strongly believes public transport can be made profitable with the right management and vision. That’s why his government has now officially moved toward the takeover.
For the state government, the financial burden isn’t immediate. The ₹13,000 crore debt raised by L&T will be transferred to the state, and an additional one-time payment of around ₹2,000 crore may be made to L&T. After due diligence and financial structuring, Hyderabad Metro will come fully under state control.
This was always part of Revanth Reddy’s strategy. That’s why he first removed NVS Reddy from the post of Metro MD. The interim appointment is only temporary—he wants a capable professional who can run the Metro the way he envisions. He’s unlikely to let private companies have any shadow over this project in future.
This is not some impulsive or reckless decision. It’s a bold, calculated, and strategic move.
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