A high-level meeting between officials of the Central and Delhi government held last Thursday to discuss the payment of Rs 5,000 arbitral award to Delhi Airport Metro Express Pvt Ltd. (DAMEPL) remained inconclusive with no consensus between the two key stakeholders.
The meeting was presided over by Union Ministry of Housing and Urban Affairs (MOHUA) Secretary, Manoj Joshi, and attended by Naresh Kumar, Chief Secretary, Delhi Government, DMRC Managing Director Vikas Kumar, Director (Finance) Ajit Sharma, and representatives of the various banks.
The meeting was convened after DMRC wrote to the Delhi and Central government, who are 50:50 joint venture partners in the DMRC, seeking financial assistance for the payment of Rs 7,000 crore arbitral award to DAMEPL.
The delay in the payment of the arbitral award to DAMEPL is putting an additional interest liability of Rs 1.24 crore per day on the DMRC. A delay of more than a year has already cost DMRC an additional interest liability of Rs 500 crore.
In the last six months, DMRC has failed to honour the three orders of Delhi HC that directed it to make a payment to DAMEPL.
On DMRC’s proposal to contribute Rs 2,500 crores each by both the partners as an equity contribution, Joshi said the Central government will contribute Rs 2,500 crores, subject to the approval from Ministry of Finance, but Delhi Government should also pay the same amount as its contribution.
Delhi Chief Secretary Kumar said the government has no budget provision to pay Rs 2,500 crore to the DMRC, as an equity contribution.
Joshi presented a second option under which DMRC would raise Rs. 5,000 crores worth of loans from banks, backed by the sovereign guarantee from the Delhi Government as well as the Centre in the proportion of their equity stake in the company.
Kumar said he had no instructions from the Delhi government to discuss this aspect.
The meeting ended without any solution for the payment of Rs 5,000 crores arbitral award to DAMEPL.
DMRC had earlier stated in the court that it was financially constrained to arrange the required funds from its internal resources or through debt from banks, as it will fall into a debt trap.
The Supreme Court, in September 2021, upheld the arbitral award in favour of DAMEPL It's been over a year now and DAMEPL is still waiting for the satisfaction of the award. In the last six months, DMRC has failed to honour the three orders of Delhi HC that directed it to make a payment to DAMEPL.
