Metros are major capital assets of cities. Urban Metro Projects have proven to be very useful in decongesting large cities. According to International Association of Public Transport (UITP), there are around 156 cities around the world having a metro system, adding up to nearly 549 metro lines, 9,200 stations and 11,300 kilometres of line infrastructure by the end of 2014. Together, the world’s metro systems carry 160 million passengers per day, moving daily the rough equivalent of Bangladesh’s entire population, the 8th most populated country in the world!

Operational Metro System in India

The metro system is currently operational in 7 cities across India. Delhi is leading with 213 kms of operational length and the construction for another 140 kms is in progress. Kolkata is the oldest system in India, whereas Chennai is the latest entrant in the league of Metro System in India. Gurgaon is the first metro project under Public-Private Partnership mode.

The metro family will expand in 2016 after the launch of Kochi Metro and Hyderabad Metro. Other cities that are constructing metros are Lucknow, Ahmedabad and Nagpur.

Fare Structure

Different metro systems in India are following the different fare structure. The minimum and maximum fare slabs are different in the country. Interestingly, Delhi Metro is the most economical metro system in the country with average fare of just 50 paise per km. For example, the commuters can travel to Dwarka Sector 51 to Huda City Centre (a length of 60.1 km) by paying a fare of INR 30.

Chennai Metro is the costliest metro line in the country with average fare of INR 4.0 per km. Although Mumbai Metro is charging the highest fare slab of INR 45 (effective from December 1, 2105) and is one of the costliest metro lines in the country as the operation is managed by the private operator. Fare Fixation Committee under Mumbai Metro has recommended maximum fare of INR 110 for the metro but the operator is charging discounted lower amount to attract more customers. The project is executed on BOOT (Build-Own-Operate-Transfer) model and required huge investment from the private players. The concession is awarded for the period of 35 years. Thus, the cost of operation is high.

Jaipur is the first metro system in India that will have two fare structures – Peak and Non-Peak. However, currently Jaipur Metro is charging non-peak fare only to incentivize the commuters. All metro systems have introduced Smart Card to collect the fare. Delhi Metro gives 10% discount on the use of Smart Card, whereas Bangalore Metro offers a discount of 15% on the use of Smart Card.

Further, they have introduced special card for tourists for unlimited travel over short duration on metro lines.

Fare Revision Formula

Metro systems across the country are regulated under Metro Railway (Operation & Maintenance) Act, 2002. As per Section 33 of the Act, Metro Rail Administration (MRA) may fix the fare without the recommendation of Fare Fixation Committee on the initial opening of the metro railway. If MRA desires to revise the fare, they would require to constitute a Fare Revision Committee under Section 34(1) of the Act.

There is no fare revision formula to revise the fare of metro system on period basic. Mumbai metro has proposed a fare formula with different weighted average to 3 key components – Energy Price (22%), Maintenance & Other Cost (21%) and Consumer Price Index (57%). It is proposed that 10% of the cost increase should be absorbed by MRA towards productivity factor. However, fare revision is still a big political issue in India. The governments generally deferred decision to revise the fare of metro system.

For example, Delhi Metro has no automatic fare fixation formula. The fares were last revised in 2009 when the minimum fare was raised from INR 6 to INR 8 with the maximum fare raised from INR 22 to INR 30. Delhi Metro has approached the government to revise the fare owing to rising energy and maintenance cost. The government has finally constituted a committee to review the same. As per new proposal, Delhi Metro desires to replace existing 15 fare slabs with a 5 fare slabs system (ranging from INR 10 to INR 50). It is estimated that the new fare slabs, if implemented, would bring 38% more revenue and resolve the issue of shortage of coins for change.