Delhi Airport Express

GROUP NO 3JASDEEP SINGH 111018P SWETHA 111030VAIBHAV BAWEJA 111056VINAY DHOK 111059

Delhi Airport Metro Express Line

DMRC’s first PPP project

Civil part was handled by DMRC – 60% of project

January 2009 Reliance Infrastructure get 30 year contract

Project finalised in 2006

Construction started in November 2007

Operation started in February 2011

India’s first high speed metro rail

Covers 23 km & 6 stations in 18 minutes

Runs from New Delhi Railway station to Dwarka through IGI Airport

17 km of journey is through underground tunnel

Stations Distance From New Delhi

Underground/Elevated Type & Facility

New Delhi 0 km Underground Terminal Station with full passenger check-in & Baggage check-in facility

Shivaji Stadium(CP) 2 Km Underground Intermediate Station with only passenger check-in facility & Baggage check-in facility

Dhaula Kuan 8.5 Km Elevated Intermediate Station with only passenger check-in facility

Delhi Aerocity (Mahipalpur)

15.8 Km Underground Intermediate Station with only passenger check-in facility

Airport(Terminal 3) 19.2 Km Underground Intermediate StationDwarka Sector 21 22.7 Km Underground Terminal Station

Delhi Airport Metro Express Line

Need for a Delhi Airport Link

Requirement of a mass transit system to link airport with Delhi

city

More vehicles causing

traffic and pollution

Rapid Population Growth in

Delhi

Lack of Good Public

Transit System

Passenger movement

to/fro airport by

private vehicles

CWG would bring

additional traffic to/fro

airport

Contract with Reliance Infra

Authority : Delhi Metro Rail Corporation Ltd. (DMRC)

Cost of project (in INR): 5800 crores

Concessionaire Special Purpose Vehicle (SPV) – Delhi Airport Metro ExpressPvt. Ltd. (DAMEPL), a Special Purpose Vehicle formed by Reliance Infrastructurein consortium with CAF of Spain

Delivery : Built Operate Transfer (BOT)

O&M Cost for 30 Years(in INR): Rs 946 crores

Land: Provided by Authority

Length : 22.7 Km (17Km Underground and 5.7km on elevated section)

Concession Period : 30 years

Award Date : January 2008

Parties Involved

Sl No. Company Name Role played in project

1 Delhi Metro Rail Corporation Authority

2 Reliance Infrastructure Concessionaire - 95% of equity in project, EPC Contractor

3 CAF, Spain Concessionaire - 5% equity in project, Supply of metro cars

4 Siemens, Faiveley Supply of automatic doors for stations

5 Indra, Spain Supply of ticketing machines

6 Alcatel Communication Systems

Terms of Contract

Obligations of Authority (DMRC) Concessionaire Scope (DAMEPL)Providing right of way and necessary clearances prior to handing over to Delhi Airport Metro Express Pvt Ltd

Design, Procurement of systems and equipment, Developing, Financing, Installing, Operation, Maintenance and eventually Transfer of systems related to the Delhi Airport Express

Acquisition and clearing of land to be handed over to concessionaire

Payment of Concession fee to DMRC during the operation of the service

Tunnelling and Civil Works for Underground segment, which will be handed over to DAMEPL

Ownership for risks:Traffic RiskRevenue collection riskProject completion riskOperation Risk

the concessionaire had to pay a concession fee of Rs51 crore per year

The Revenue Sharing arrangement was as follows:1% of gross revenue to be paid from first year to fifth year2% of gross revenue to be paid from sixth year to tenth year3% of gross revenue to be paid from eleventh year to fifteenth year5% of gross revenue to be paid from fifteenth year to expiry

Demand ForecastS. No. Mode of Transport Time Price Remarks

1 Cabs 1:45 hr Rs. 600 Primary Target segment

2 Bus 2:15 hr Rs. 50 The time taken by Bus is too long

3 Auto-Rickshaw 2:00 hr Rs. 250 Variation in travel time is too much

4 DMRC 1:00 hr Rs. 32+20 (Airport line)

DMRC metro goes up to Dwarka Sector-21.

T3 Terminal and 6 stations

Air India17%

Jet Airways21%

Jet Lite7%Kingfisher

4%

Indigo26%

Go Air7%

Spicejet19%

Market ShareDeparture Schedule of First & Last Train from New Delhi and Dwarka Sector-21

New Delhi Station Dwarka Sector-21

First Train 5:34:40 AM 5:15:00 AM

Last Train 11:33:40 PM 11:14:00 PM

• Airport line express metro cater to the passenger whose flight is in day time.

• More demand for night flights as cabs are difficult/unsafe International flights are scheduled at night. Metro not functional in night

• 59% of traffic flies from Terminal 1-D. These consumers are price sensitive low cost carrier users

• It is difficult to reach Terminal 1-D with the help of airport line metro

WHAT HAPPENED?

Time line for Delhi Metro Airport Express

August 2006 Delhi Metro Rail Corp Ltd. finalise the detailed project

September 2007 DMRC awarded first contract for construction

January 2009 DMRC awards 30 year build operate transfer contract to the Reliance.

March 2009 Reliance Infrastructure Ltd (R-Infra) formed a special purpose vehicle named Delhi Airport Metro Express Pvt. Ltd to build airport line from new Delhi railway station to IGI airport.

November 2009 DMRC completed 95% of civil construction work and was ready to hand over the site to R- Infra for laying tracks.

August 2010 R-Infra misses first deadline to start the operations and one month time was gives as DMRC delayed in handing over the station.

September 2010 The express line failed to get clearance from commissioner Metro Rail Safety (CMRS). DMRC fined R-Infra Rs.37.5 lakh per day for missing the deadline.

January 2011 CMRS gives safety clearance to the airport express, except for the Dhaula Kuan and Delhi Aerocity stations.

February 2011 The airport line started its operation from New Delhi railway station to IGI airport.

August 2011 CMRS grants safety clearance to Dhaula Kuan and Delhi Aerocity stations

December 2011 DMRC managing director meets R-Infra executives to discuss the areas that need improvement.

May 2012 DMRC chief expresses dissatisfaction with the performance of operations.

June 2012 DMRC hire consultants to conduct a detailed inspection of the tracks due to safety concerns.

July 2012 The R-Infra suspends services indefinite duration for safety repairs. The ministry of urban development form a two member committee to probe the defects in the civil construction of the railway line

Why was service called off?DMRC’s Stand R-Infra’s Stand

Consultant Found defect in civil construction

DMRC is blaming R-Infra for negligence in inspection

Civil defects were present from the beginning and R-Infra had already pointed out to DMRC

540 out of 2100 bearing were defective

There are no serious damages so as to call off the operations

DMRC did not work upon the issues

Supporting clips was found damaged

All the issues are under acceptable level

The project was not handed over at scheduled time

Speed slowed down to 80 from 105 over security concern

R-Infra are using civil defects as exit route

Conditions are not suitable for operation

Operation was getting risky They do not want to go further in PPPGurgaon extension is scrapped

DMRC forced procurement from approved vendor

R-Infra was not getting revenue even after higher investment

Was the project viable in the first place?

Ridership projections by DPR for 2011 – 45000 with 7.3% annual growth but past figures show no such growthActual ridership in 2011 – 15000

DAMEPL relied on DMRC provided study

Inconvenient location of stations, impact of economical and political factors

Only T3 terminal is connected

Estimated non-fare revenue to 75% (38% for MTR Hongkong)

Issues in Contract

• All risks passed on to concessionaire• DMRC assumed the role of regulator• Penalty on Reliance Infra by DMRC for delay• Concession fee and revenue percentage from handover stage

• Civil construction done by DMRC• DMRC forced procurement from approved vendor only• Seepage and mud was issue in tunnel• 90% of supporting clips has been changed • Speed slowed down to 80 from 105• DMRC estimated Rs.20 Crore budget for repair

Quality

Exit Route

• If R-Infra defaults, it will pay 20% of loan with equity

• If DMRC defaults, it will pay 130% of debt and equity

Closing Note

E Sreedharan suggested the Govt. that PPP model wouldn’t work

Reliance Infra has over estimated market demand for express line

DMRC is not only the authority in the project but also is trying to assume the role of a regulator

Both R-Infra and DMRC are reluctant to work under PPP with each other

Reliance floated a SPV and transferred the losses to the SPV. This puts the doubt on the intension of the Reliance

After the operating the metro for over a year, Reliance closed the operation citing the safety issues

Maintenance estimates by DMRC is Rs20 crore which is comparatively a small fee compared to the capital invested on the project

Reliance is trying to exit PPP contract by blaming DMRC for adopting poor construction measures

Thank you