L&T asks Centre to sanction funds for Metro Rail works

Hyderabad, Jan 01: The L&T company, which was completing the Hyderabad Metro Rail is facing a financial problem in speeding up the remaining work on the project, is waiting for Viability Gap Fund (VGF) from the Centre.

The Centre had assured that it would provide Rs 1,458 crore as VGF up to July 2018. In the current financial year, the Centre released Rs 1,111.55 crore.

The VGF eligibility up to October 2017 was Rs 246.59 crore but Centre released Rs 154.02 crore in November, leaving the balance of Rs 92.67 crore. In the remaining five months, the Centre has to release Rs 157.66 crore. L&T has requested the Union finance ministry to release the balance immediately.

L&T has invested Rs 13,310.39 crore so far in the Metro Rail project. Commercial banks have to release about Rs 1,700 crore to L&T. Several commercial banks had sanctioned Rs 9,905.78 crore for the project, and had released Rs 8,181.59 crore up to October end. L&T has paid Rs. 2,499.34 crore as interest.

In the current financial year central government has released Rs 957.54 crore up to October towards VGF. L&T has to be received balance amount of VGF is Rs 256.79 crore from the central government up to July 2018.

L&T has asked the Centre to take action to release the ninth installment of grant (VGF) of Rs 92.63 crore for the period ending October.

The company also sent a certificate issued by its auditor and the certificate issued by lead financial institution SBI regarding the details of disbursement up to October.