delhi metro case

1. Let us Begin the journey through
DELHI METRO

2. DELHI METRO
Amol Azad
Rajat Singla

3. "We (DMRC and its partners) have acquired the
expertise for most of the work. We have always
wanted to have a more patriotic approach in
our work and are proud that we can do the job
ourselves in such little time," says DMRC
managing director E. Sreedharan said in a
recent interview.
Quote by E. Sreedharan

4. Executive Summary
‡ The National Capital Territory of Delhi with a population of around 14 million
has a vehicle population of around 4 million. Bus travel is the predominant
mass transportation system in Delhi.
‡ This has resulted in increasing traffic congestion, increasing road accidents
and increasing air pollution. Though a number of studies were carried out and
recommendations made to solve the mass transportation problem of Delhi, it
was only in 1998 that the Delhi Metro Rail Corporation was formed with equal
equity participation of the Government of India and Government of the
Capital Territory of Delhi to plan, execute, operate and maintain the Delhi
Metro.
‡ The Delhi Metro Rail Project is being planned and executed in four phases -
Phase I, Phase II, Phase III and Phase IV.
‡ It consists of 3 lines - Line 1, Line 2 and Line 3. Line 1 is partly elevated rail and
partly surface rail. Line 2 is underground metro. Line 3 is partly underground
and partly elevated rail.

5. Executive Summary (Cont.)
‡ Line is completed and is operational. Phase I is scheduled for completion by 2005,
Phase II by 2010, Phase III by 2015 and Phase IV by 2020.
‡ The project requires the deployment of several technologies - Constructional
Technology, Rail Coach Technology, Power Systems Technology, Rail Communication
and Control Technology, Microprocessor Controlled Smart Card Technology.
Underground tunnel construction involves considerable risks due to uncertain
geological conditions. The project is executed with the help of both local and
international contractors who are contracted to design and build the facility. An
International Consortium of Consultants oversees the work.
‡ Japan Bank for International Cooperation is extending loan to the project to the extent
of 56% project cost. Government of India, Ministry of Urban Development and the
Government of the National Capital Territory of Delhi are each investing 15% of the
project cost. The remaining is met through interest-free loans and property
development. The operation and maintenance costs are essentially met by ticket sales.
‡ People of Delhi are generally satisfied with the services offered by DMRC and are
proud of experiencing one of the most modern, sophisticated and world-class
technological systems. Other cities in India and abroad have shown interest in having
metros through DMRC's services.

6. Key Architects
‡ The Central Road Research Institute (CRRI), New Delhi
‡ Metropolitan Transport Team (MTT) of the Indian Railways
‡ Delhi Development Authority (DDA)
‡ The Study Group of the Ministry of Railways
‡ RITES (Rail India Technical & Economic Services)
‡ Mr. E. Sreedharan, Managing Director, DMRC

7. Implementers/ Stakeholders
‡ The Delhi Metro Rail Corporation Ltd. (DMRC).
‡ Ministry of Railways and Ministry of Urban Affairs, Government of India.
‡ Government of the National Capital Territory of Delhi (GNCTD).
‡ Delhi Transport Corporation (DTC).
‡ Governments of Uttar Pradesh & Haryana (At a later date) General Consultants (A
consortium of Indian and Overseas Consulting Firms).
‡ The consortium comprising ROTEM (formerly KOROS), Mitsubishi Corporation, and
Mitsubishi Electric Corporation - manufacturers of Rolling Stock.
‡ Bharath Earth Movers Limited (BEML), the Indian Coach Builders.
‡ KSHI JV, a consortium of builders for open cut works with Maunsell, Australia engaged
as the lead design consultant.
‡ IMCC, a consortium of builders for underground works with Mott MacDonald, UK as the
lead design consultant.
‡ The Japan Bank for International Cooperation (JBIC).
‡ The citizens of Delhi (Those who pay and use the Metro and those who are indirectly
benefited).

8. Key Objectives -
‡ The main objective of the project is to improve Delhi's urban environment by reducing traffic
congestion and pollution. The Project is expected to help reduce traffic congestion, exhaust emissions,
and other types of urban pollution caused by motor vehicles, and to play a large role in improving
Delhi's transit system.
‡ Outcomes-
‡ Out of 271.45 ha of land required for the project, 237.062 ha has already been acquired. A punctuality
of 6 minutes is being maintained at present during peak hours. This interval would gradually be reduced
to 3 minutes when adequate traffic builds up. Train-sets of four coaches in rake have been put into
service. They run at intervals of 8 to 10 minutes from 6 a.m. to 10 p.m. The maximum speed of the
Metro is 80 km/h with an average stoppage time of 20 seconds at each station.
‡ Delhi Mass Rapid Transit System is essentially a ͞social sectoȑ project, whose benefits will pervade
over wide sections of the economy. I phase will generate the following benefits to the city.
‡ 21.82 lakhs commuter trips per day will be siphoned off the roads. This would mean:
‡ 2,600 less buses on the roads. Increasing in average speed of buses from 10.5 km/h to 14 km/h.
‡ Metro will reduce journey time by 50 to 75 percent.
‡ Saving of 2 million man-hours per day due to reduced journey time.
‡ Saving in fuel cost worth Rs. 5 billion per year
‡ Space saving- The metro can carry traffic as 9 lanes of buses / 33 lanes of motor cars (either way)
‡ Delhi will experience a net benefit of Rs. 437.23 lacks per day. q More comfortable & safe travel for the
commuters
‡ Reduction in atmospheric pollution levels by 50%.

9. Major Contracts
‡ Local Competitive Bidding, International Competitive Bidding and Progressive Indigenization are the
modes used for contracting work.
‡ Local Competitive Bidding
‡ Design and construction of surface and elevated Lines 1 and 3 are packaged for contracting on
design-bid-build basis through local competitive bidding.
‡ International Competitive Bidding
‡ Line 2 with its more challenging underground alignment and tight construction schedule is being
procured through two large internationally tendered design build contracts. Following a
competitively contested tender that required a rebid process in efforts to lower contract price
estimates, the two design-build contracts were awarded in February 2001.
‡ The 50-month contract for the 4km-long open-cut section from Vishwa Vidyalaya to the Interstate
Bus Terminal (ISBT) station was awarded for a tender value of Rs. 900 crores to: KSHI JV comprising
Kumagai Gumi (Japan ʹ leader), Skanska (Sweden), Hindustan Construction (India), and Itochu
Corporation (Japan), and with Maunsell, Australia engaged as the lead design consultant.

10. ‡ The scheduled 60-month contract for the 7km-long, mainly bored tunnel section
from the ISBT station to Central Secretariat, with five open-cut stations and an
NATM mined station at Chawri Bazaar, was awarded for Rs. 1700 crores to:
International Metro Civil Contractors (IMCC) comprising Dyckerhoff & Widmann
(Germany ʹ leader), Shimizu Corporation (Japan), Larsen & Toubro (India),
Samsung (Korea), IRCON International (India) and with lead design consultant Mott
MacDonald, UK.
‡ The construction methodology for the underground Corridor was finalized after
taking into account the availability of open space above the alignment, ground
conditions, conditions of nearby existing structures and likely settlement in the
vicinity.
‡ In addition to the civil works, design for the design-build contracts also includes
station & services, ventilation, air conditioning, lighting, station finishes,
landscaping, and the provisions for the fitting of platform edge doors at a later
date.
‡ Delhi Metro Rail Corporation (DMRC) has awarded a contract to Alcatel TAS the
design, installation and commissioning of the full Integrated Rail Communication
system for the metro.
International Competitive Bidding (Contd.)

11. Indigenization
‡ DMRC is procuring 240 coaches of which 60 (4 trains) are
manufactured in ROTEM, Korea.
‡ BEML Bangalore will manufacture the other 180 coaches (45
trains). Starting with the local assembly and testing of a few
trains, BEML will manufacture the coach shell, traction motor,
converter, inverter unit, battery, passenger announcement
and information system, air-conditioning units and seats. This
will help in acquiring capability and avoiding import of trains
for the forthcoming metro projects in Bangalore, Ahmedabad,
Mumbai and Hyderabad.

12. Strengths
Cost-effective mode of transport for the
general public of Delhi.
Reduce congestion on roads making
movement easier.
Reduce atmospheric pollution to a great
level making the environment healthy.
Ultra-modern technology and visually
striking design, dynamic and modern,
competitive World Class.
One hundred per cent punctual operations
Weakness
Metro considerably more expensive
than the bus.
Less ridership than estimated.
High development cost
Displaced many economic backward
people.
Difficulties in acquiring land.
Opportunity
Revenue from property development and
advertisements.
Potential to achieve higher ridership.
Tax rebate given to the DMRC because of the
2010 Commonwealth Games in Delhi.
The success of the Delhi Metro has encouraged
other Indian cities to seriously attempt to
introduce Metro systems.
The next Metro line in the city will be 10-15 per
cent cheaper than the previous phases based on
the learning curve theory.
Threats
A struggle on the part of those being
displaced, and protests, petitions,
hunger strikes, negotiations and legal
action have all been initiated.
Security threat.
Risk of cost overruns and ridership
shortfalls.
Increase in cost of the parts.

13. The Man Behind The Success Story
͞Politicians Know I Cannot Be Maneuvered͟, E Sreedharan

14. About the Man
‡ Elattuvalapil Sreedharan, 77, is a disciplined, simple man who
calls himself a ͚Railway Man/Metro Man' with 36 years of
service in the Indian Railways.
‡ Lauded for achieving the 'almost impossible' in a government-
administered system and given extensions by the government
after his retirement in 1990, Sreedharan comes with a
reputation of bringing fantastic results.
‡ He almost has an obsession with deadlines. (In the early years
of his career, it earned him 20 transfers.) Every officer in
DMRC keeps a digital board which shows the number of days
left for the completion of the next target.
‡ The 77-year-old civil engineer has been selected as one of the
most outstanding Asians by Time magazine.

15. His other little known achievements
‡ In 1963, disaster struck the Rameshwaram island when tidal waves
washed away the Pamban bridge connecting it with mainland Tamil
Nadu. A passenger train was swept away, killing hundreds of persons.
‡ The Southern Railway decided to restore the bridge and set a target of six
months. General Manager B.C. Ganguly advanced the deadline by three
months and the Railway Board assigned the task to a 31-year-old
executive engineer, Sreedharan. It was a tough task as it was an old
bridge, built by the British in late-nineteenth century, with 146 spans and
a scherzer-a steel girder which opens up for large vessels to pass under
the bridge.
Sreedharan took up the challenge and advanced the deadline by a
month, making the task tougher. He made the bridge functional in 46
days. He achieved this by the application of some 'commonplace values'-
discipline, punctuality and honesty-and the introduction of a new work
culture. These traits continue.

16. His other little known achievements
‡ Sreedharan successfully completed another mega-project -the Konkan railway
between Maharashtra and Mangalore. The rail-line was mooted in 1990 by then
railway minister George Fernandes, while talking to Railway Board members.
After studying it, Fernandes himself dismissed it as impossible.
‡ A month later, Sreedharan went to Fernandes with a well-charted out plan. "I
told him that we will have to work in a different fashion," he recalls. Probably his
enthusiasm infected Fernandes, who got cabinet approval for the project within
three days. Maharashtra and Kerala immediately agreed to the project, but
Karnataka chief minister Virendra Patil objected.
‡ Sreedharan, then a member of the Railway Board, went to Maharashtra,
Karnataka, Goa and Kerala and got all the necessary approvals before his
'retirement'. But retirement was not to be as Fernandes wanted him to head the
West Coast Railway. Thus the Konkan Rail Corporation was born. It created an
engineering marvel by laying a rail network across the mountainous Western
Ghats.

17. IIM Lucknow Case study facts
‡ Expected passenger traffic - 21,80,000 per day.
‡ Today only 5,00,000 commuters use the metro per day.
‡ The DMRC website states that the estimated number of
originating passengers per day in the year 2011 for Phase I
and Phase II corridors will be 26,17,000.
The project nevertheless is a success͙

18. IIM Lucknow Case study facts
‡ About 1,100 train trips operate every day with a punctuality
of nearly 100 per cent.
‡ According to DMRC spokesperson Anuj Dayal the metro earns
Rs 1 crore daily, of which Rs 65 lakh comes from passenger
fare and the rest comes through associated activities like
property development, advertisements and displays,
consultancy and others.

19. DMRC- Pride of the Nation
‡ Following DMRC's success, it has been asked to prepare
detailed project reports for metro rail transport systems, both
in India as well as abroad.
‡ Countries that have sought its consultation for their project
management include, Pakistan, Bangladesh, Indonesia, Sri
Lanka , Syria, Ireland and Indonesia.
‡ According to IIM- Lucknow, due to its technical expertise,
timely completion of projects and the corporate culture it
operates in, DMRC has attained the readiness to compete
with other similarly placed agencies globally.

20. A Cost-benefit analysis of Delhi metro
Courtesy: Indian Institute of Economic Growth, Delhi University
Cost Financed By Phase I Phase II
1) Equity (50% each by GOI & GNCTD) 30% 30%
2) Long Term Debt (Overseas Economic
Cooperation Fund, Japan) @ 3% p.a. or less
60% 56%
3) Revenues From Property Development 7% 5%+ 5%
(internal
resources)
4) Subordinate Debt 3% 4%

21. The Funding
‡ More than 60 percent of the funds required for investment are
raised as debt capital.
‡ Around 30 percent of total investments of DM are raised through
equity capital with the Government of India (GOI) and GNCTD
having equal shares in it.
‡ The remaining 10 percent of the investments of DM will be covered
out of the revenues it earns.
‡ DM had been provided with the following concessions by GOI to
make the project viable, namely
(a) The cost of land equivalent to Rs. 2180 million has been provided
as an interest free subordinate loan by GOI/GNCTD to be repaid by
the DM within 5 years after the senior debt is repaid fully by the
twentieth year of taking the loan
(b) The risk associated with the exchange rate fluctuations is borne by
government in case of foreign debt

22. (c) The DM is exempted from payment of income tax, capital
gains tax, property tax and customs duty on imports.
(d) The DM is permitted to generate resources through property
development over a period of 6-20 years.
(e) No dividend is paid on GOI share of equity till the senior debt
is repaid fully by the twentieth year.

23. A financial analysis of the Metro
Sources of revenue for the metro are (according to RITES)
‡ The Fare Box Revenues
‡ Revenue from Advertisement
‡ Revenue from Property Development
‡ The main source of revenue of the MRTS system is the fare
box collection, which is a product of the total passenger
ridership on the MRTS.

24. A financial analysis of the Metro
‡ Full ridership is expected to materialize on the metro with a fare
comparable to the DTC bus fare of Rs. 3 per passenger trip.
‡ The financial model consisting of Rs. 5 per passenger trip and an
annual fare increase of 7.5 per cent was considered optimal by
RITES.
‡ Fare Sensitivity of Ridership on the Metro
(In Rs/Passenger trip)
Fare Rate Percentage Ridership
3 100%
4 90%
5 75%
6 50%

25. Estimates of Daily Passenger Trips by Metro
(in lakhs)
Year Daily Passenger Trips
2002 12.63
2003 20.15
2004 23.86
2005 31.85
2006 33.17
2007 34.55
2008 35.97
2009 37.46
2010 39.01
2011 40.63
2012 41.81
2013 43.03
2014 44.29
2015 45.58
2016 46.91
2017 48.28
2018 49.69
2019 51.14
2020 52.63
2021 54.17

26. Estimates of Financial Flows of Revenue Earned by
DM (Phases I and II) During its Lifetime
(Rs. Million)
Year Revenue Year Revenue Year Revenue
2005 15052 2018 67722 2031 128687
2006 17152 2019 74284 2032 133307
2007 19407 2020 82806 2033 134177
2008 21826 2021 92342 2034 139477
2009 24421 2022 99126 2035 140477
2010 33762 2023 106242 2036 146547
2011 37112 2024 115557 2037 147687
2012 41057 2025 116067 2038 154657
2013 44511 2026 119127 2039 155947
2014 50847 2027 119717 2040 163947
2015 49633 2028 123227 2041 165437
2016 56277 2029 123897
2017 62209 2030 127927 a ten fold increase

27. Identification of Economic Benefits and Costs of Metro
‡ DM contributes to the diversion of a very high proportion of
current passenger traffic from road to Metro and serves part
of the growing passenger traffic demand in Delhi.
‡ There will be savings in travel time for passengers still
traveling on roads due to reduced congestion and obviously
also for those traveling by Metro.
‡ The Metro also brings about a reduction in air pollution in
Delhi because of the substitution of electricity for petrol and
diesel and reduced congestion on the roads
‡ There will also be a reduction in the number of accidents on
the roads.

28. Identification of Economic Benefits and Costs of Metro
‡ Reduction of government investments on road developments and
buses as also in the private sector investment on buses, passenger
cars and other vehicles carrying passengers.
‡ Reductions in motor vehicles͛ operation and maintenance charges
to both the government and the private sector.
‡ There will be health and other environmental benefits to the public
due to reduced pollution from the transport sector of Delhi.
‡ Land and house property owners gain from the increased valuation
of house property prices due to the Metro.
‡ The Metro has the effect of increasing the income of the regional
economy of Delhi vis a vis the rest of the Indian economy.

29. Identification of Economic Benefits and Costs of Metro
‡ The Metro provides employment benefits to the unskilled
labour especially during its construction period. This labour is
otherwise unemployed or under employed in the Indian
economy.

30. Components of Economic Capital and O&M Cost

31. Reduction in Vehicles Due to Metro (Phases I & II)

32. Benefit from Reduced Vehicles
‡ The economic benefits from the reduced number of vehicles on
Delhi roads due to the Metro could be identified as the
following:
‡ Savings in Foreign Exchange due to reduced Fuel Consumption
‡ Reduction in Pollution
‡ Savings in Time for all passengers using Metro and Roads.
‡ Savings in Accidents.
‡ Savings in Vehicle Operating Cost (VOC) due to decongestion
for residual traffic.
‡ Savings in Capital and Operating cost of diverted vehicles .
‡ Savings in the cost of Road Infrastructure.

33. Benefit from Reduced Fuel Consumption
‡ The total savings in fuel due to decongestion is the product of
residual traffic, fuel savings norms given by the above
formula, annual run and a conversion factor (cc to litre) in a
RITES study.
‡ The fuel savings during the year 2011-12 due to the
decongestion effect for cars and buses are 20,714,391 Litre
and 38,510,952 Litre, respectively. The RITES study has
assumed that the fuel savings of two-wheelers are roughly
one-third of cars, which becomes 6,835,749 Litre.

34. Reduction in Pollution Load due to decongestion and its
Monetary Value for the Year 2011-12 with the Assumption
that All Vehicles Use EURO II Technology without Metro

35. Savings due to reduction in Pollution

36. Net Benefits to the Government
‡ What it gets:
± Fare box revenues
± Revenue from property development
± Advertisements
± Tax Revenues from goods or services bought for the
metro
± Saved cost of road infrastructure
± Saved cost of operating buses

37. Net Benefits to the Government
‡ What it loses
± Heavy revenue losses due to displaced
buses(Estimated 2400 buses will be displaced by
2012).
± Investment and operation and maintenance of the
metro.
The net benefits for the government during the year
2011-12 are estimated as Rs. 31760 million at 2004
prices.

38. Net Benefit to the Passenger
‡ What they get:
± time saving for the passengers due to the Metro
± During the year 2011-12, these savings are
estimated as Rs. 22090 million .
± benefits due to a reduction in accidents to the
passengers due to the functioning of the Metro,
which are estimated as Rs 448 million during the
year 2011-12.
‡ What they pay: fares
‡ The net benefits to the passengers from the
Metro are estimated as Rs.22440 million during
the year 2011-12.

39. Affects to the Private Transporter
‡ What they get:
± Save on their capital and operating costs
± This is estimated to be Rs. 6550 million
‡ What they lose:
± Lose the revenue from displaced private buses
± This is estimated to be Rs. 9410 million
‡ resulting in a net loss of Rs. 2860 million to the
private transporters during the year 2011-12.

40. Net Benefit to the unskilled labour
‡ Benefit to the labour is the difference of working at DMRC
and the opportunity cost
‡ Assuming that the unskilled labour cost constitutes 10 percent
of investment cost and 5 percent of operation and
maintenance cost of the Metro, the benefit to unskilled
labour is estimated as Rs. 316.4 million during the year 2011-
12.

41. Net Benefits to the General Public
‡ What it gets:
± Social premium on investment and foreign exchange
± Environmental benefits of reduced pollution due to
the Metro.
± Social Premium: reduced fossil fuel consumption due to a
change in the mode of transport .
± The net benefits to the general public from the
Metro arising out of the social premium on foreign
exchange is estimated as Rs. 1203.3 crores during
the year 2011-12.

42. Total Benefit
‡ The government, passengers, private transporters and the
public get total net benefits worth Rs. 52550 million in the
year 2011-12.

43. Environmental Impact
‡ A detailed Environmental Impact Assessment has been done in
1994 to minimize the negative environmental impact of the
Project during the construction stage of the Project.
‡ For every tree cut during construction, the DMRC is planting 10
trees in advance as compensatory afforestation. Around 26000
trees have been planted at Najafgarh, Isapur and Rebla Khanpur.
Through proper care 30% of trees in the alignment have been
saved.
‡ Installation of storm water drains for disposal of wastewater,
monitoring air and noise pollution, disposal of excavated
materials are some of the measures taken during construction to
minimize the damage to the environment and inconvenience to
public.

44. International Certification
‡ The Delhi Metro has been awarded OHSAS 18001
(Occupational Health and Safety Assessment sequence 18001)
by Registro Italiano Navale India Pvt. Ltd. (RINA), Genova.
‡ The Delhi Metro Rail Corporation (DMRC) received the ISO
14001 certificate for establishing an environmental
management system making it the First Metro in the World to
receive this certification at the construction stage.

45. First Delhi Metro Coach To Come By Air Arrives
From Germany

47. Bibliography
‡ The Delhi Metro Rail Corporation has brought out a 256 page book titled " A
Dream Revisited" (An Archival Journey into the making of the Delhi Metro Rail),
which describes the History, Growth, New Technologies, Routes and issues
which faced the Delhi Metro Project since its planning up to its implementation.
‡ Indian Institute of Economic Growth, Delhi University
‡ IIT Delhi research report
‡ IIM Lucknow case study on Delhi Metro
‡ ICMR India.org
‡ Wikipedia
‡ http://www.delhimetrorail.com