Collateral damage: IL&FS crisis may hit Metro work

Bengaluru: With Infrastructure Leasing & Financial Services (IL&FS) caught in a debt crisis, Bangalore Metro Rail Corporation Ltd (BMRCL) officials are worried their deadlines may be further hit.

IL&FS subsidiary IL&FS Engineering and Construction Company Ltd is a major contractor for BMRCL. It had bagged the contract to build 3.94 km long line between Mysuru Road and Pattanagere stations as part of Phase 2 of the project at a cost of Rs 327 crore.

It will have four stations (all elevated ones) Nayandahalli, Rajarajeshwarinagar, Jnanabharathi and Pattanagere towards Kengeri.

The company has been drawing flak from BMRCL for its delays. It had recently imposed a penalty of Rs 1 crore on IL&FS Engineering for tardy work and had issued strict instruction to finish the work by December.

According to the source, in the wake of the current crisis IL&FS Engineering has decided to go slow on ongoing projects and not take up any new ones.

This will also impact the proposed Outer Ring Road and BIAL metro project. BMRCL Managing Director Ajay Seth was unavailable for comment.

A senior BMRCL official told Deccan Chronicle, "IL&FS Construction was the one of the best company for the metro work in the country. As the company is going through a tough phase we have extended the deadline by some more months."

The Mumbai-based company has six more months to complete the metro work on the Mysuru Road stretch.

IL&FS is currently burdened with a consolidated debt of around '91,000 crore. It is also under the scanner of many regulatory agencies such as SEBI and RBI for alleged loan defaults.