In a major development, the Mumbai Metropolitan Region Development Authority (MMRDA) terminated the contract of Larsen & Toubro and Scomi Engineering (LTSE) for the Mumbai Monorail and took over the operations and maintenance (O&M) of the Monorail on Friday. The move ends months of speculation about the future of the transport system, which has been plagued with issues.
Metropolitan Commissioner R.A. Rajeev said, “Operation of Monorail will not get affected. This is a smooth transition. We have been working on it for some time. We gave them a seven-day notice as a final notice. The notice period ended yesterday.” MMRDA issued a show-cause notice on December 7, and the last date to respond was December 13. LTSE’s contract was to end on December 31 and were seeking an extension till June 2019. MMRDA had granted them extension seven times.
Trip rates raised
MMRDA in their notice said they failed to fulfil the grounds on which they were given an extra trip rate in July, which included repairing the defunct rakes and start operations of the crucial Phase 2, which runs between Wadala and Jacob Circle. In July, MMRDA, on the suggestion of the one-person committee, increased the trip rate to ₹10,600. The first phase resumed operations on September 1 after being shut for nearly a year, after a fire in November 2017 had gutted two coaches of an empty rake.
Mr. Rajeev said, “We gave them an opportunity. We revised their trip rate in anticipation that they will bring more rakes into operation and they will start operations of Phase 2. For that I had not just given them a deadline, but I had given them a monthly target.” Only four out of the 10 rakes are operational, as they rest require spare parts. LTSE was supposed to repair two rakes each in November, December and January, leading to a plan to commission Phase 2 in January. Mr .Rajeev said there has been no indication of LTSE fulfilling their promise.
“Since we have increased the trip rate, we have paid ₹6 to ₹7 crore extra. At least spares worth that amount should have come. They’ve done nothing,” Mr. Rajeev said. MMRDA encashed around ₹200 crore of bank guarantee as part of the contract. Mr. Rajeev said that they will settle dues against bank guarantee after they recover the money they had given to LTSE as an advance to procure rakes and spares.
LTSE was an independent company in which L&T and Scomi Engineering had 55% and 45% stake respectively. L&T was to complete the civil works of the project, while Scomi Engineering was to provide rolling stock and handle the O&M. “L&T cannot be blamed. They are partners, however, the blame lies squarely with Scomi,” Mr. Rajeev said.
Operations to be moved
‘A total of 198 personnel of LTSE working for O&M activities of the Monorail will be hired through an external agency. The MMRDA staff will lead various heads of the O&M activities. MMRDA officials said once the Mumbai Metro Operation Corporation Ltd is established, Monorail operations will be moved under it.
LTSE and MMRDA are also in an arbitration, which Mr. Rajeev said will go on. He said the move was in public interest and since Scomi had failed in operations. The Hindu reached out to both companies. Neither of them responded to queries at the time of going to press.
