When the Hyderabad Metro Rail Concession agreement was signed seven years ago, the minimum fare fixed for travel up to the first two kilometres was ₹ 8 per head. The maximum for travel of more than 18 kilometres was mere ₹ 19 for the launch scheduled for 2014.
As per the agreement, the fare should have been be revised annually, by a price escalation formula, which had allowed 5% increase every year in the first 15 years, besides neutralising the inflation up to 60 per cent based on the Wholesale Price Index (WPI). The formula was worked out and incorporated in the agreement so that there would not be any outside interference, and the consumer would be protected from profiteering motives of the private operator.
However, seven years later, after much anticipation and wait, the government has dropped a bombshell on the prospective travellers, by revising the fares to almost double of what they should have been.
While there is nothing to complain about the minimum fare, which has been kept lower than the price escalation had allowed, the maximum at ₹50 for over 18 kilometres and ₹60 for more than 26 kilometres far exceeds the initial ₹19.
According to an official from Metro Rail, the maximum fare should not have exceeded ₹28-30, calculated as per the formula mentioned in the Concession Agreement.
Though the rationale for the fare hike escapes the common traveller, it was a long foregone option for the Hyderabad Metro Rail authorities.
The State government had forfeited its right to fix or revise the fares and thus its promise to its citizens in 2012 itself, when it had agreed to enter the regime of The Metro Railways (Operation and Maintenance) Act, 2002 (Metro Act) shifting from the original A.P. Municipal Tramways (Construction, Operation & Maintenance) Act 2008 it was conceptualised under.
Under the Metro Act, the Metro Rail Administration (MRA) is entitled to fix the initial fares.
After the Mumbai High Court’s ruling in favour of the concessionaire with regard to the fares of Mumbai Metro Rail, the HMR had voluntarily given way to the Larsen & Toubro, the concessionaire here, as the MRA. The present fares, thus, have been fixed by L&T, and Telangana government has little right to reduce them, an official from HMRL shared.
However, the Act allows for constitution of Fare Fixation Committee for subsequent fare revisions, consisting of a chairperson and two members. The chairperson should be a sitting High Court judge, and the Centre and the State can nominate a member each, equal to the rank of additional secretary to the Government of India.
