Government auditor CAG has pulled up Delhi Metro Rail Corp (DMRC) for not following the Urban Development Ministry’s orders on debt-equity ratio for the Airport Metro project.
As a result, the operator, Delhi Airport Metro Private Ltd (DAMEPL), brought in a paid-up equity of only Rs 1 lakh to operate the project, which had a cost of Rs 5,697 crore.
The Urban Development Ministry had asked DMRC to put in a condition providing for a debt-equity ratio of 7:3 in the concession agreement. But, DMRC did not do so, the CAG pointed out. Concession agreement is the contract between DMRC and DAMEPL.
The Airport Metro project in Delhi, the first metro to be implemented on public-private partnership basis, is under scanner after DAMEPL, a Reliance Infra special purpose vehicle, withdrew unilaterally from the project. Now, DMRC has been forced to operate the loss-making project.
“Audit observed that Ministry’s orders for maintaining debt-equity ratio of 7:3 were neither incorporated in concession agreement nor complied by concessionaire,” CAG said.
The CAG also pointed out that investments from DAMEPL’s escrow account went only into Reliance mutual funds, while multiple investments were permitted, including Government securities. These investments were listed in the procedure to operate the escrow account between DAMEPL and Axis Bank, said CAG. In effect, mutual fund schemes of Reliance received Rs 6.01 crore (2009-10), Rs 222.3 crore (2010-11) and Rs 0.55 crore (2011-12), CAG has said.
The audit body also said that DMRC failed to ensure the payments due to it and also withdrawals from escrow accounts, as per agreements.