DMRC seeks to raise Rs 2,700-crore loan to pay Reliance Infrastructure

A month after the Supreme Court directed the Delhi Metro Rail Corp (DMRC) to bring Rs 4,600 crore out of its coffers for its long-standing liability to a Reliance Infra (RInfra) subsidiary, DMRC has written to 18 banks, inviting bids to raise a Rs 2,700-crore loan.

The court had upheld a Delhi High Court order, conse­quent to which DMRC is to pay the arbitral award amount, alo­ng with interest, to Reliance In­fra-owned Delhi Airport Metro Express Private Limited (DAM­EPL) in two equal instalments.

The sought loan amount is the balance of what DMRC owes to DAMEPL, people in the know said. Through its submissions in an escrow account from time to time, DMRC has already paid Rs 2,445 crore to the Reliance firm in compliance with previous court orders.

As of May 31, DMRC has incurred an interest liability of over Rs 300 crore solely on account of delays in payment to DAMEPL. Right now, the firm is adding more than Rs 1.15 crore every day to its incremental interest burden.

The letter to banks — including SBI, Axis Bank, Bank of Baroda, Bank of India, Canara bank, HDFC, ICICI, Kotak, and PNB — stated that the capital expenditure loan is for the purchase of Delhi Metro’s airport line assets.

The metro operator, in the letter, had asked banks to submit their individual or consortium-represented price bids by May 30. The deadline date, however, has been extended to Friday. DMRC aims to draw the loan in the next 12 months.

According to DMRC’s terms and conditions, the loan will be for 15 years, which will be paid off via 44 quarterly principal instalments and monthly interest payments following a four-year moratorium period. The letter also said the Centre was considering a proposal to provide sovereign guarantee against the loan. The two firms have been at loggerheads ever since DAMEPL pulled out of the Delhi Metro Airport Line operations due to safety issues arising from structural defects.

An arbitral court, in 2017, had ruled in favour of the RInfra firm, asking DMRC to pay DAMEPL the amount, which it had borrowed from 11 banks.