The Delhi government on Monday said that the cost of Metro’s Phase-IV came down by Rs 10,000 crore as it had specifically asked Delhi Metro Rail Corporation (DMRC) to cut the project’s expenditure.
Transport minister Kailash Gahlot said one of the reasons why the cost of Phase-IV got reduced was a condition on cost escalation put by the Delhi government before the DMRC. For all projects, Delhi Metro keeps certain percentage of its total cost for the expenditure incurred on construction based on changes in the price index over a period of time, which is known as cost escalation.
“The Delhi government had clearly conveyed it to DMRC in January, 2017 that the Phase-IV project would get approval only if its annual escalation factor was reduced to 5% instead of 7.5% as was proposed in the first DPR (detailed project report),” he said.
A cabinet note dated January 6, 2017, seen by HT, corroborated the claims made by Gahlot. Read More
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