As Metro rail expansion gathers pace nationwide, public-private partnership (PPP) projects in the segment are showing signs of strain. L&T’s decision to exit the Hyderabad Metro project and Reliance Infrastructure’s earlier attempts to divest its stake in Mumbai Metro Line 1 have underscored the need to recalibrate the PPP model.
Even as Metro networks expand rapidly across nearly 20 cities, large-scale systems have proved difficult to sustain as commercially viable private assets. Governments continue to lean on private capital to bridge funding gaps, but experts suggest the model needs recalibration amid recent exits of private players.
Hyderabad Metro Phase-I, one of the world’s largest PPP metro projects, is set to be taken over by the Telangana government, which will refinance debt and acquire L&T’s entire equity stake. The government will provide around ₹2,000 crore in cash to L&T as a one-time settlement, while it assumes around ₹13,000 crore of SPV-level debt. L&T’s investments in the project hovered around ₹7,000 crore at the end of the second quarter of FY26.
