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Mumbai's new metro on track for a dispute over fares
MUMBAI - Mumbai's metro rail, delayed since 2011 and heading for a dispute with the government over fares, went into service on Sunday with thousands crowding the station to witness Hindu priests offer blessings.
But a dispute over the fare price lies ahead.
Mumbai Metro One - a unit of Reliance Infrastructure, which is controlled by Indian billionaire Anil Ambani - is charging 10 rupees (21 Singapore cents) for a one-way ticket for the first 30 days, but will later increase the fare to as much as 40 rupees, according to its website.
Yet the regional government wants it to charge between 9 rupees and 13 rupees in accordance with a contract it signed, the Business Standard reported yesterday, citing Maharashtra Chief Minister Prithviraj Chavan.
"Disputes over pricing and tariffs deter investment and that should be avoided when so much money is required for infrastructure," Mr Dharmakirti Joshi, chief economist at Crisil, S&P's local unit, said in Mumbai.
The infrastructure itself is always playing catch-up... we're building today what should have been built yesterday."
Mr Chavan told reporters in Mumbai the dispute would be settled according to the contract with Reliance Infrastructure.
"This is not the time" for such questions, said Mr Ambani.
