State Cabinet Approves Full Control of Metro Phase-1
The Telangana government has officially moved to end the public-private partnership for the Hyderabad Metro. In a landmark cabinet meeting chaired by Chief Minister Revanth Reddy, the state approved the complete takeover of the 69-km Phase-1 network from Larsen & Toubro (L&T). The transition is set to be finalized by March 31, 2026, marking a new chapter for the city’s urban mobility.
This strategic acquisition aims to clear a significant hurdle for future expansions. The Union Government had previously mandated that for Phase-2 to proceed as a joint venture between the Centre and the State, the entire existing network must be under a single administrative entity. With L&T expressing reluctance to invest in further phases, the state determined that full ownership was the only way to fast-track new corridors.
The financial details of the deal highlight a calculated move by the government. While the market value of the Metro’s assets is estimated between ₹19,000 crore and ₹22,000 crore, the state is acquiring the network for approximately ₹15,000 crore. This includes taking over ₹13,000 crore in outstanding debt and providing a one-time settlement of ₹2,000 crore for the private operator’s exit.
Commuters are assured that daily operations will remain smooth during this handover. The government has decided to extend the current operating contract with Keolis for another year as an interim measure. This ensures that the technical expertise required for running the sophisticated transit system remains in place while the state integrates the Metro into its broader infrastructure vision.
By bringing the Metro under state control, the government hopes to stabilize the project’s financial structure and improve fare rationalization. The move is also expected to unlock lower-interest funding from international institutions for the ambitious 76-km Phase-2A and 86-km Phase-2B corridors. This decision underscores the administration’s commitment to making Hyderabad a global hub with a seamless, state-owned transit backbone.
