Cash Crunch Stalls Subway Projects

EghtesadOnline: Tehran’s subway network requires 20 trillion rials ($88.49 million) to launch 10 stations in three lines, the CEO of Tehran Metro Company said.

News ID: ۷۸۵۷۸۹

19 January 2021

Ali Emam added that the construction of these stations in Lines 3, 6 and 7 are almost complete and the additional budget is required for the purchase and installation of elevators, escalators and other equipment, IRIB News reported.

Elaborating further, Emam said the stations are Aqdasieh and Mahallati in Line 3, Sattari, Ashrafi Esfahani, Yadegar-e Emam, Marzdaran and Shahrak-e Azmayesh in Line 6 and Baqerkhan, Qiam and Tarbiat Modarres in Line 7.

"Each station requires 300 billion rials to 1.5 trillion rials [$1.32-6.63 million]. The money would also cover workers' salary for two months."

Last year (ended March 2020), Tehran Municipality was authorized to issue 15 trillion rials ($66.37 million) of participatory bonds for streamlining the public transportation system. The subway’s share of the bonds was 10 trillion rials ($44.24 million), which was supposed to be paid by October 2020.

“Only 2 trillion rials ($8.84 million) were encashed and delivered early this week,” Emam said.

Manaf Hashemi, TM’s deputy for traffic and transportation affairs, said the municipality has promised to encash the remaining bonds issued last year and help expedite subway construction.

In October 2020, Tehran City Council ratified a motion allowing TM to raise another 40 trillion rials ($177 million) through participatory bonds for developing public transportation in the current fiscal year.

Officials believe that the new stations connecting the east to the west of the city will considerably reduce traffic congestion and air pollution.

Tehran’s subway stretches over 220 kilometers and comprises seven lines (1 to 7) with nearly 120 stations. Lines 3, 6 and 7 are yet to become fully operational.

Tehran Metro’s Line 3, which extends 38 km from Shahrak-e Qaem in the northeast to Azadegan in the southwest, is a crucial line as it crosses busy parts of the capital and helps alleviate traffic problems. Once fully operational, the line will have 26 stations.

Line 6 will be the longest line in the subway network, stretching over 38 km with 27 stations when fully constructed. It connects Shahr-e Rey in southeast Tehran to the famed Sulqan rural district in the northwest.

In further stages, the line will expand to Shah Abdol-Azim Shrine in the ancient district of Rey to the south of the city.

The 27-km Line 7, which connects the northwest to southeastern parts of Tehran, will have 25 stations after completion.

Budget Deficit

Earlier in September, Mohammad Alikhani, the head of Tehran City Council’s Transportation Commission, said the subway’s network in the capital needs 2 quadrillion rials ($8.84 billion) for the construction of unfinished lines, purchase of train cars and standardization of equipment.

He added that due to the negative effects of US sanctions since the summer of 2018, Iran’s rial is losing value against hard currencies, making it a tough task to expand and renew the ailing public transportation in Tehran.

Since the US reimposed sanctions against Iran in 2018, the rial has lost 70% of its value against the greenback over the past year. On Monday, the US dollar was trading at 215,000 rials in Tehran while it hardly fetched 42,000 rials in March 2018.

“A train wagon cost 50 billion rials a couple of years ago, but now the price reaches 200 billion rials, which Tehran Municipality cannot afford at present,” he added.

Mohsen Hashemi, the head of TCC, also expressed disquiet over Tehran subway’s shortfalls and said, “While the subway lines have been extended around the city by 80 kilometers in the past several years, not enough trains have been added to the metro’s network.”

Hashemi noted that for each kilometer of the subway, there was 1.1 train wagons.

“Today, the figure has fallen by 30%, which means that for each kilometer of operating subway line, there is 0.8 train cars,” he added.

Urbanists blame mismanagement and lack of budget for the slow progress of Tehran Metro’s expansion projects.

In early June, Alikhani had said the capital city’s subway system faces serious shortcomings that will not be obviated even in two decades, if policymaking processes and budget management are not overhauled.

“The subway network still lacks 3,000 train cars to facilitate 10 million daily travels … There are around 1,300 train wagons currently operating in Tehran’s subway, 30% of which need to be upgraded,” he said.

TM expects the number of commuters to surge by 25% after subway lines 6 and 7 are up and running.

But this is definitely not sufficient for Tehran where, according to pre-coronavirus statistics, over 10 million people commute daily, many from the surrounding cities and towns.