The Chief Minister's Office of Telangana announced on Sunday, 5 July 2026 that Chief Minister Revanth Reddy has written separate letters to two Union Ministers urging expedited approvals for Hyderabad Metro Rail Phase-II expansion and faster completion of the state government's takeover of Phase-I assets.

Context

Chief Minister Revanth Reddy addressed the letters to Union Minister for Housing and Urban Affairs Manohar Lal Khattar and Union Minister for Coal and Mines G. Kishan Reddy. The letters call for personal intervention by both ministers to immediately complete the appointment of SBI Capital Markets (SBICAPS) as the central nodal agency for the metro project's financial review.

The CM recalled high-level meetings held on 23 and 24 June 2026 between state and central government representatives, during which both sides had agreed to appoint SBICAPS to conduct a comprehensive study covering asset valuation of Phase-I, refinancing of high-interest loans, and long-term funding mobilisation for Phase-II.

Policy Backdrop

Hyderabad Metro Rail Phase-I became operational in 2017 under a public-private partnership framework involving L&T Metro Rail, with central government sanction through the Ministry of Housing and Urban Affairs. The Telangana government has been pursuing a formal takeover of Phase-I assets as a precondition for seamlessly advancing the Phase-II expansion.

Central government approvals for metro rail projects — including Terms of Reference (ToR) for nodal agency mandates, Detailed Project Report (DPR) clearances, and financial restructuring support — flow through the Ministry of Housing and Urban Affairs. Delays in finalising ToR documents are a recurring friction point in centre-state coordination on urban mobility projects across India.

The CM's letters specifically flag that despite the June agreement, the Ministry of Housing and Urban Affairs has not yet finalised the Terms of Reference (ToR) for SBICAPS, and the formal assignment of responsibilities to the agency remains pending.

Stakeholder Impact

The CM warned that the ongoing delay is causing day-to-day operational difficulties and uncertainty in the management of Phase-I, while simultaneously slowing down DPR approvals and fund-mobilisation processes for Phase-II. He cautioned that continued postponement risks significant cost escalation and further delays in project execution.

Hyderabad commuters and urban local bodies stand to be most directly affected. The Phase-II expansion is described by the CM as critical to meeting the city's future public transport needs, and any delay compounds pressure on an already stretched urban transit network in one of India's fastest-growing metropolitan regions.

SBICAPS, as the designated central nodal agency, is expected to play a pivotal role in determining the financial viability and structure of both the Phase-I asset transfer and the Phase-II build-out. Its formal appointment is a prerequisite for subsequent valuation reports and funding frameworks.

What's Next

The immediate watch point is whether the Ministry of Housing and Urban Affairs finalises the ToR and formally assigns SBICAPS its mandate in response to the CM's letters. Once SBICAPS is appointed, its valuation and refinancing study will set the financial parameters for the Phase-I takeover and shape the funding architecture for Phase-II corridors.

The CM expressed confidence that prompt central intervention would allow decisions taken jointly by the centre and state to be implemented without further delay — enabling the Phase-I handover to be completed and Phase-II expansion work to proceed on schedule. The pace of response from both Union Ministers will signal the centre's priority level for Hyderabad's metro infrastructure in the near term.