Everyone who has traveled by the Delhi Metro wants one in his or her city.

Today, there is a
national resurgence in public interest in urban public transport."1

- Dr. Manmohan Singh, Prime Minister of India, in 2006.

"The successful implementation of the Delhi Metro project would not have been possible
without timely availability of funds and the necessary political support. An equally important
role has been played by the DMRC's corporate culture, which emphasizes that targets are
most sacrosanct and our dignity is in performing our duty well."2

- E. Sreedharan, Managing Director, Delhi Metro Rail Corporation Ltd., in 2005.

Introduction

With a 6.5 km section of Line 3 becoming

operational in April 2006, Phase I of the Delhi
Metro3 project was nearing completion. Of the
total length of 65.16 km of the first phase, 62
km had been completed and opened for service.
This phase was set to cost Rs. 98 billion. As of
early 2006, around 450,000 passengers were
traveling by the Delhi Metro every day.

The Delhi Metro was meant to solve Delhi's

traffic problems, which had become almost
unmanageable. The first steps to build a metro
system in the city were taken in the early 1990s.
In 1995, the Government of India (GoI) and the
Government of the National Capital Territory of
Delhi (GNCTD) formed the Delhi Metro Rail
Corporation Ltd (DMRC) under the Companies
Act to construct the Delhi Metro.

Conceived as a social sector project, a significant portion of the project cost was funded
through a soft loan provided by the Japanese government through Japan Bank International
Corporation (JBIC)4. The rest was contributed by GoI and GNCTD through equity.

E. Sreedharan (Sreedharan) was appointed

managing director (MD) of the DMRC and
project manager for Phase I of the project in
November 1997. Work on Line 1 of Phase I
started in October 1998. DMRC formed
consortiums to advise it on the project and to
provide it with the latest technology. It also saw
to it that the foreign companies worked with the
Indian companies to ensure that the latter
assimilated their expertise and technological
know-how.

The DMRC faced any number of technical and

 systemic challenges during the construction of
the metro.
1] "PM lays foundation stone for Bangalore Metro," www.pib.nic.in, June 24, 2006.

2] "Interview with Mr. E. Sreedharan, Managing Director, Delhi Metro Rail Corporation Ltd," www.indiainfoline.com, December 19, 2005.

3] A metro system is usually an urban electric mass transit railway system independent of other traffic and with high frequency. A metro system
includes elevated, at-grade, and underground sections.

4] JBIC was founded in 1961 by the Japanese government as the Overseas Economic Cooperation Fund (OECF). It served as the implementing
agency for loan aid given to entities in developing countries. OECF generally gave low-interest (around 2.1%), long-term funds (about 20 years with
five year grace period). In 1999, OECF was merged with Export-Import Bank of Japan (JEXIM) to form the JBIC.

Introduction Contd...

However, thanks to thorough planning, an

effective project design, and a 'we-mean
business' culture, it was able to overcome all
these hurdles. The organizational culture was
based on punctuality, honesty, and a strict
adherence to deadlines. The DMRC successfully
managed the various stakeholders in the project
like the general public, government bodies, etc.,
and also ensured that the project was
environmentally safe.

With Phase I of the Delhi Metro project nearing

completion, the GoI decided to extend the metro
network and work on Phase II of the Delhi
Metro project was set to commence in
September 2006.

In the process of implementing the project, the DMRC had gained a lot of
technological expertise, which would be used by other cities in India and abroad
to build metro systems similar to the Delhi Metro.

Background Note

Metro systems were generally considered as a

transport option when the population of a city
crossed the 1 million mark (Refer Exhibit I to
know more about metro transit systems). Delhi
crossed that milestone as early as in the 1940s.

The 1950s saw a doubling of the city's

population; with that, the vehicular traffic also
soared. By the early 1990s, Delhi had more
registered vehicles than Mumbai, Kolkata, and
Chennai put together.

It had become one of the most polluted cities in the world, with automobiles contributing to
more than two thirds of the total atmospheric pollution. There was an urgent need felt at this
point to improve both the quality and availability of mass transport services in Delhi.

The first ever traffic study of Delhi (titled the 'Origin – Destination Survey of Traffic of
Greater Delhi') was carried out by the Central Road Research Institute (CRRI) in 1957. As
many as 35 more studies on Delhi's transport problems were conducted subsequently by
various entities (Refer Exhibit II for some of these studies). Almost all these studies
recommended the Mass Rapid Transit System (MRTS) as a means to solve Delhi's traffic
problems.

In 1989, the GNCTD, with support from the GoI, commissioned a feasibility study for
developing an MRTS for Delhi. The study was undertaken by Rail India Technical &
Economic Services Ltd. (RITES)5 and completed in 1991...

5] RITES, established in 1974, is the multi-disciplinary consultancy wing of the Indian Railways. RITES has served as a consultant to top
organizations and Governments in 55 countries. It largely operates in the fields of transport, infrastructure, and related technologies

Excerpts

The Delhi Metro Project

In order to implement the Delhi Metro project, the GoI and the GNCTD set up a
50:50 joint venture company called the Delhi Metro Rail Corporation Ltd. (DMRC).
The company was incorporated under the Companies Act in May 1995. The
DMRC was to complete Phase I of the project within 10 years, i.e., by the end of
2005...

Funding the Project

Globally, most urban MRTS projects were

financially unviable because the fares
could not be fixed solely on a commercial
basis. If the fares were fixed too high, the
passenger numbers would remain low,
thereby defeating the very purpose of
setting up the system. Therefore, the
concerned governments generally bore
the capital costs of an MRTS system. In
the case of the Delhi Metro project too,
the GoI and the GNCTD bore the capital
costs. The total cost of the first phase of
the project was initially estimated at Rs.
60 billion, at April 1996 prices. Later in
2002, with the cost of the project rising by
approximately 10% per year, the estimate
was revised to Rs. 89.27 billion...

The Project Team

With the funding for the project being finalized, the next step was to constitute a
project team. Sreedharan was appointed as project manager and managing
director of the DMRC in November 1997. A technocrat, he had had a long stint in
the Indian Railways (IR) and had retired in 1990. During his service with IR, he
had earned a reputation for completing major projects on time and within the
budget...

Planning the Project

In India, major infrastructure projects are

often stalled because of a lack of funds,
political interference, lack of
professionalism and accountability,
property disputes, corruption, etc.
Therefore, even before the
commencement of the project, the DMRC
attempted to put in place effective
systems to ensure the smooth progress of
the project.

Funding was not an issue in the case of

the Delhi Metro project because it was
settled even before the project
commenced.

In order to steer clear of political interference, the DMRC sought autonomy on all
major matters and the GoI promised to give it this autonomy. "Financial powers
were vested in the managing director. Also, the managing director was the last
authority on tenders," said Anuj Dayal (Dayal), chief public relations officer,
DMRC...

Excerpts Contd...

Project Implementation

Construction work on the project

commenced on October 1, 1998. The
entire project was divided into three lines.
Further, these lines were divided into
sections (Refer Table III for details of
Phase I of the Delhi Metro project).

Line 1 (Shahdara to Rithala)

The work on Phase I commenced with the
Shahdara-Tis Hazari section of Line 1,
covering a distance of about eight
kilometers. The work involved utility
diversions, barricading, and actual civil
construction. A major part of this section
was on elevated tracks. All tracks in the
elevated corridor were laid on concrete
(ballastless). The tracks were supported
on single piers...

Managing the Stakeholders in the Project

Effective project management involved not only completing the project on

schedule and within the budget, but also managing the project's stakeholders.
The stakeholders included the governments, the contractors, the funding
agencies, and the general public. Despite assurances that the DMRC would enjoy
autonomy, it faced political pressure not only in its recruitment processes,
promotions, and contract awarding but also in land acquisition...

Project Evaluation

The successful completion of the project effectively silenced the critics who had
been skeptical about the ability of an Indian public sector organization to
complete any project, let alone one as complex and costly as the Delhi Metro, on
time and within the budget...

Outlook

The Delhi Metro was expected to play a

major role in relieving the transport
problems faced by the city's residents.
Moreover, with the GoI planning
extensions to the Metro, it appeared that
the benefits of an efficient transport
system would be enjoyed by people living
in a wider geographical area than
originally planned. The GoI and the
GNTCD had prepared a comprehensive
plan to extend the Delhi Metro to 244 km
by 2021 in three subsequent phases
(Refer Exhibit VI for more information
about the Delhi Metro project by 2021)...

Exhibits

Exhibit I: Some Metro Systems around the World

Exhibit II: Studies on Delhi's Traffic Problems
Exhibit III: Outstanding Features of the Delhi Metro
Exhibit IV: Companies Involved in the Project
Exhibit V: Tunneling Process of a Part of Line 2 of Delhi Metro
Exhibit VI: The Delhi Metro Project by 2021
Exhibit VII: Approved Budget 2006-2007
Exhibit VIII: Operational Aspects of the Delhi Metro Project Phase I