Karnataka cabinet approves revised cost of Rs 40,425 crore for Bengaluru Metro phase 2, seeks central nod
The state government attributes the cost escalation to increased land acquisition costs, which it says have jumped from 30 per cent to 100 per cent of the land's guidance value. Additionally, the cost of civil work has increased by Rs 4,408 crore. It also highlighted that the length of the metro line extending from 72.09 km to 75.06 km also contributed to cost escalation.
As a result, to cover the net cost increase of Rs 14,019 crore, additional financial assistance of Rs 9,729 crore has been approved by the cabinet, which has also decided that the additional fund will be shared among the central and state governments and Bengaluru Metro Rail Corporation Limited (BMRCL).
The cabinet has also decided to submit a proposal to the Centre for the revised project cost of Rs 40,425 crore.
However, as per the memorandum of understanding (MoU) between the Centre, the state and BMRCL over the metro project, most of these cost escalations (eg, land acquisition, civil work, and scope change due to line extension) fall under 'other cost escalation', are to be entirely borne by the Karnataka government, and are not related to central statutory duties/levies or exchange rate variations.
Bengaluru Metro's phase 2 project includes extensions of the purple line (Mysore Road to Kengeri and Baiyappanahalli to Whitefield) and green line (Nagasandra to Madavara and Yelachenahalli to Silk Institute), plus new yellow and pink lines. As of May, the green line has been extended to Madavara (3.14 km). It has been operational since November 2024. The yellow line (RV Road to Bommasandra, 18.82 km) is facing delays due to the unavailability of rolling stock, pushing the operations to June 2025.
The pink line (Kalena Agrahara to Nagawara, 21.26 km) is delayed to December 2025 or early 2026 because of land acquisition and tunnelling issues. Phase 2A (KR Puram to Central Silk Board) and Phase 2B (KR Puram to Kempegowda International Airport), which are being undertaken at slow paces, are targeted for late 2026.
Satya Arikutharam, an urban mobility expert, said BMRCL sought the state government's approval for this almost a year ago. 'The state government is likely to bear a major portion of the cost escalation, in accordance with the tripartite MoU. Given the scope change (double-decker structure), land acquisition cost escalation (state government responsibility), construction delays (difficult tunnelling conditions not foreseen), and delay in rolling stock procurement, the bulk of the cost escalation will become the state government responsibility,' he added.
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