Project delays, time and cost overrun in infrastructure projects, delays in regulatory approvals and contractual disputes are some of the challenges faced in implementing a project in India.
In an exclusive interview with INFRASTRUCTURE TODAY, Dr Brijesh Dixit, Managing Director, Maharashtra Metro Rail Corporation (Maha Metro) reveals how the use of digital project management delivered huge benefits to the project, saving around $18 million.
How are Pune and Nagpur projects moving with the envisaged plans and what are the commissioning deadlines?
About 46.5 per cent of the Nagpur project is completed and it is expected to be commissioned by December 30, 2019. The Pune project has seen a physical progress of 3 per cent. The total cost of Nagpur Metro is Rs 8,680 crore and Pune Metro Rs 11,420 crore. Both projects are funded partially by the Central and State Government through equity, subordinate debt (SD) and the rest through official development assistance (ODA) loan from KfW, Germany and Agence Frantaise de DTveloppement (AFD).
What is the financial viability of these two projects and what kind of returns are predicted?
As of now, Rs 1,555 crore has been disbursed for Nagpur Metro project, which includes equity from the Government of India and the Government of Maharashtra, other ULB grant, pass through assistant (PTA) and the value of land taken. For the Pune project, Rs 20 crore has been disbursed.
As far as external funding is concerned, for Nagpur project, Rs 3,750 crore (Euro 500 million) is from KfW Germany and Rs 975 crore (Euro 130 million) is from Agence Frantaise de DTveloppement. Fund flow via PTA route has started. As per detailed project report (DPR) prepared by Delhi Metro Rail Corporation (DMRC), the financial internal rate of return (FIRR) of Nagpur is 9.63 per cent and that of Pune is 11.78 per cent. Hence, both the projects are financially viable.
What is the ridership that you expect for these two projects? Importantly, since both the projects are based on the engineering, procurement, construction (EPC) mode, what are the various revenue sources identified for these metros after implementation?
As per the DPR, the targeted ridership for Nagpur Metro is 352,442 in the year 2018, which will increase to 563,735 in the year 2041. The targeted ridership for Pune Metro is 571,883 in the year 2018, which will go up to 739,364 in the year 2041. The revenue sources mainly consist of fare box collection and other income from property development; advertisements in trains, stations, station names, wrapping of trains, parking areas, property development at station and outside station and revenue from transit-oriented development (TOD).
For flawless infrastructure implementation, how important is it to deploy technology as advanced as 5D BIM, integrated with SAP ERP and Highbar Technologies? Do you think they should be replicated in other metro projects too?
In line with the global best practice, Maha Metro has adopted the digital platform of 5D building information modelling (BIM) and enterprise resource planning (ERP), using world-class software to manage the project and mitigate challenges during the construction, operations and maintenance phases, or the entire life cycle. Such technological use, addressing the challenges of mega infra projects like cost and time overruns, effective asset management, effective document management, quality and safety, is new to project management.
Nagpur Metro is also the first project in India to adopt 5D BIM integrated with ERP, which is implemented by AurionPro-Highbar-Excelize consortium with technology from Bentley Systems, SAP, RIB and Primavera. It is a known fact that ERP and project management technologies were deployed by many metro organisations. What we have attempted is to bring the engineering together with ERP and project management, so that it all works as one system, thus improving productivity and efficiency, bringing in certainty in schedules and costs. In terms of engineering, we brought all the disciplines in one platform with uniformity in drawing and model production, so that co-ordination, interfacing and high project progress visibility become easier with less surprises.
Since this is very large innovation we brought in, it is important that we train our stakeholders to understand the big picture and to comply with the procedures set up with digital project management. We have already started BIM Academy with initial assistance from Bentley Systems.
How did the use of digital project management help Maha Metro in planning and saving costs? We have achieved around 12 per cent cost savings with respect to logistics, travel and man days, and it is expected to increase to 15 per cent. Around 8 per cent savings in time has been achieved so far and it is expected to touch 11 per cent.
Nagpur Metro is likely to achieve reduction in overhead costs from 5 per cent to 3.5 per cent by the end of the project. While other metro projects are going ahead with a 10.5 m viaduct, Nagpur Metro opted for a 8.5 m viaduct, which helped them save around $18 million. In addition, Maha Metro saved around 8.5 per cent on the DPR of the project cost and around $60,000 on Metro Bhavan HQ, because of early detection of quantity overrun through BIM mode planning and clash detection. What is more, due to optimal design of sheds, stabling lines, inspection bay lines and repair bay lines, Maha Metro has saved around $15 million, avoiding delays through BIM mode planning. Digital project management in planning has benefitted effective utilities shifting, optimal right of way ROW planning and importantly, effective land acquisition.
Maha Metro still requires substantial amount of land to be acquired. How is it likely to happen? Do we see private land acquisition as an option, as earlier, it was not considered to save interest on compensation amount?
The total requirement of land for this project is 87.73 hectare as per DPR and the possession of total land admeasuring 78.39 hectare (89.35 per cent) up to July 13, 2017 is received.
The total government land required for this project is 86.79 hectare, which is held by the state and central government agencies. Out of this, 77.45 hectare (89.23 per cent) land is acquired by Maha Metro, Nagpur.
The requirement of private land is 3.16 hectare, out of which possession of 0.93 hectare of land is achieved. Maha Metro has decided to acquire private land by direct purchase method as per the Government of Maharashtra Resolution, Revenue and Forest Department, dated May 12, 2015; September 30, 2015 and January 25, 2017. By adopting this method, Maha Metro will compensate two-and-half times the cost of market value to the land owners, due to which the land owners are ready to give possession of their land. However, some of the landholders are not ready to hand over for various other reasons.
Is there anything innovative being done for the Pune and Nagpur Metros? What are the key takeaways that can be replicated in other envisaged metro projects in India?
The following initiatives are taken in Nagpur Metro Project:
1.Owners' support office assists Maha Metro in digital project management, which is underpinned by the use of 5D BIM for effective project monitoring, project control and digital model/ data handover for operations and maintenance.
2.Use of solar energy to the extent of 14 MW makes Nagpur Metro the greenest metro in India. In addition, an eco-park is being developed as a green initiative.
3.Optimisation and rationalisation of designs of civil and system-side infrastructure, resulting in huge savings in cost.
4.Maha Metro BIM Academy brings together the project stakeholders and supply chains under a common set of objectives via awareness sessions, trainings, forums, targeted seminars and planned working groups.
- Rahul Kamat