Reliance Infrastructure cancels $1.9bn Mumbai metro project

Only days after the Mexican government announced that it was annulling the contract for a $3.7bn high-speed rail project, the company building an entire line for Mumbai’s metro has walked away from the deal. 

Reliance Infrastructure, which is India’s largest private sector power utility, gave as the reason for its decision "non-fulfilment of certain critical obligations" by the state government of Maharashtra. Among other problems, the government was unable to get approval from the federal government’s environment ministry for depots to be set up in land in the districts of Mankhurd and Charkop. 

Reliance has said that even after four years and despite "the best efforts by the government of Maharashtra, various project impediments could not be resolved". 

The government of Maharashtra and Reliance parted company by way of a "no cost, no claims" termination agreement.  

The project was awarded to Reliance in 2009. Under the deal, it held a 48% stake in the line, which was to have run down the Charkop-Bandra-Makhurd corridor. 

The company has run Mumbai’s first metro line, connecting the western suburb of Versova with Ghatkopar in the east, since May this year.

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