Hyderabad Metro Phase II Likely to Get Clearance Despite Budget Exclusion

Hyderabad, February 5, 2025 – Despite the absence of dedicated funds in the Union Budget, the much-anticipated Hyderabad Metro Rail Phase II expansion remains under active consideration, with approvals expected in the coming months, according to senior government officials.

Project Progress and Evaluation

The ₹24,269 crore Phase II expansion, covering 76.4 km across five corridors, is currently undergoing a technical evaluation by the Union Ministry of Housing & Urban Affairs. Officials clarified that the budget proposals presented by Finance Minister Nirmala Sitharaman would not hinder the project's progress.

“The evaluation process is in motion, with relevant ministries, including railways and surface transport, actively reviewing the proposal,” said an official on the condition of anonymity. “Given that the project aligns with central metro rail guidelines, there is strong optimism for approval.”

Funding Prospects and Financial Backing

While the budget did not allocate funds for new metro projects in Telangana, the Hyderabad Metro Phase II still holds strong funding prospects. Revised estimates for Mass Rapid Transit System (MRTS) and metro projects across India have been set at ₹24,691 crore for 2024-25, with total proposals amounting to ₹31,239 crore for the current financial year—signaling a favorable environment for metro expansion.

To secure necessary funding, the Telangana government is seeking a sovereign guarantee from the Centre. This is essential to obtain concessional loans from international financial institutions such as:

Japan International Cooperation Agency (JICA)

Asian Development Bank (ADB)

New Development Bank (NDB)

The proposed funding structure for Phase II is as follows:

Telangana government: 30% (₹7,313 crore)

Central government: 18% (₹4,230 crore)

External loans: 48% (₹11,693 crore)

Public-private partnership (PPP): 4% (₹1,033 crore)

Officials also noted that nearly 10% of the Centre’s capital expenditure remained unutilized last year, increasing the likelihood of the project receiving approval under revised budget estimates.

Phase II Expansion Routes

Hyderabad Metro Phase II aims to enhance connectivity across key corridors, including:

Nagole to Shamshabad RGIA (Airport Corridor): 36.8 km

Raidurg to Kokapet Neopolis: 11.6 km

MGBS to Chandrayangutta (Old City Corridor): 7.5 km

Miyapur to Patancheru: 13.4 km

LB Nagar to Hayatnagar: 7.1 km

Encouraging Precedents

A recent precedent further strengthens the case for Hyderabad Metro Phase II. In October last year, the Chennai Metro Phase II project secured central approval, demonstrating that similar metro expansion projects remain a priority.

With approvals anticipated soon and financial mechanisms being actively explored, Hyderabad Metro Rail Phase II is on track to transform urban connectivity in the city, despite the initial budget setback.