Time is money Nagpur Metro’s Phase-II set to unlock Rs 31,000 crore in economic gains: ADB

 

 

 

Post-completion of Phase-II of Nagpur Metro, the passengers using the service in Nagpur are going to reap huge benefits over the next 30 years, says a report by Asian Development Bank (ADB), which states each metro passenger will save around 7.8 minutes of travel time. When this time saving is calculated for all passengers over three decades, it results in a huge economic benefit. One may see the saved time as quite low, but given the compounding effect, the total money saved by passengers is estimated to be approximately Rs 31,100 crore (Rs 311.3 billion), as per the report. The ADB’s analysis breaks down time savings into three major components. The first and largest source of benefit comes from passengers who shift from road travel to metro.

 

With an average metro speed of 34 km/hr compared to 20.2 km/hr for road vehicles, commuters travelling an average distance of 10.4 km will save considerable time. The total time saved is calculated based on the number of passengers making the shift to metro and the per-person time saving. The monetary value of this time is estimated using a Value of Time (VoT) of Rs 87.0 per hour, derived from Nagpur’s 2023 per capita income. The model assumes those 67% of passengers are working and the remaining 33% are non-working, with non-working passengers’ time valued at 30% of working passengers’ VoT.

 

The second component of savings applies to those who continue using road transport. The study also assumes that post commissioning of Phase-II of Nagpur Metro, the number of vehicles on the road would decrease slightly. Thus, average road speeds are expected to increase from 20.2 km/h to 22.2 km/h, resulting in a time saving of roughly 3 minutes per trip. These time gains are calculated for all road users who do not switch to the metro, with future figures beyond 2042 projected using the city’s decadal population growth rate.

 

The financial value of this time saving is computed using the same VoT metrics. The third source of benefit arises from the metro system’s reliability, which removes the need for commuters to build in extra buffer time, typically 25% of total travel time into their daily schedules. This translates into an additional saving of 7.8 minutes per passenger. The analysis compares expected travel times with and without the buffer, using metro ridership data over different years, and applies the VoT to monetise the savings. All three components have been combined to arrive at the total projected value of time savings, with economic benefits expressed directly using a conversion factor of one. So it’s clear, the more citizens rely on metro, the more benefits they can derive. Phase-II of Nagpur Metro will reach out to industrial pockets as well as to areas where road is congested. Thus, in long run, people stand to benefit using rapid transport means as long distance would be covered faster using metro than the road network.

 

Khapri to MIDC ESR - 18.5 Km
Automotive Square to Kanhan River - 13 km
Prajapati Nagar to Transport Nagar - 5.6 km
Lokmanya Nagar to Hingna - 6.7 km 

As per Maharashtra Metro Rail Corporation Limited (MMRCL) claim, Phase-II will benefit nearly 10 lakh people residing in these areas. Also a salient point is that pace of urbanisation along the extension to metro corridor is one of the fastest and so that will benefit the new settlers as well those who regularly commute to city. The project cost of Phase-II of Nagpur Metro is Rs 6,708 crore, to be shared jointly by Central Government and Maharashtra Government.