The State of Delhi’s Subways

Drivers endlessly honking horns, grumbling pedestrians dodging their way past vehicles of all sizes, motorists grimacing as they have to reduce speed or come to screeching halts and the drivers yelling abuses at pedestrians they just about managed to avoid hitting- one would not hesitate in defining this as anything, but chaos.

To reduce this chaos the authorities have felt the need to provide pedestrian facilities. A number of subways have been built to resolve human-vehicular conflicts and to allow free and smooth movement of vehicular traffic. However, the subways do not appear to be a very popular option to cross the road.

Apart from a general reluctance to use the subways as it demands extra effort to climb up and down the stairs, the reasons for avoidance include faulty location, poor maintenance and feeling of insecurity. Having recognized this, the authorities decided to build up shops in the subways which would ensure that the subways do not remain deserted and uninhabited. This would make them safe and prevent the genesis of illegal activities. The presence of shops would also enhance the aesthetic acceptability of the subways as well as provide a platform where need-based trades could be permitted.

However, it is true that rationality demands that a person take up a shop in the subway only if he/she sees an opportunity to make reasonable profits. Since profits are influenced by sales which in turn are influenced by footfalls, factors that influence footfalls become important determinants of the success or failure of the businesses.

Let us take up maintenance issues first. To harness the efficiencies of private participation the NDMC and PWD have outsourced the responsibility of the maintenance of subways to private contractors through the process of tenders. Maintenance comprises of providing security, cleaning, sweeping and scavenging, running and maintenance of booster pumps, removal of blockage and routine cleaning of drainage and sewerage lines, provision of dustbins and regular disposal of garbage and internal maintenance by way of cleanliness and aesthetic upkeep of the common and external areas of the structure. The contractors are required to employ a stipulated number of workmen to perform all these function failing which penalties are imposed on them. Also if the services rendered are not up to the mark the contract is liable to be terminated before expiry.

In spite of such stringent conditions of the contract just one visit to any subway is enough to conclude that most of the services are not being provided efficiently. Security guards are seldom visible, water logging during monsoons is not taken care of and dustbins are either absent or overflowing with rubbish. But it will be unfair to doom all these subways as filthy and not usable. The subway at Bhagwan Dass Road is relatively clean with no overflowing dustbins or clogged drains. But it still loses out on account of one of the parameters- security. No watchman is to be seen at any time of the day, not even an empty chair, which could tell you that he was ‘once’ there. Considering the fact that approximately Rs 76,000 are spent on its maintenance every month one can understand why security seems to be the only problem. Also, the proximity of the subway to the Supreme Court of India seems to have a role to play in keeping the concerned officials on their toes. In direct contrast to this is the subway at Bahadur Shah Zafar Marg- dark and dirty to the extent of repulsion. Doesn’t the zero maintenance expenditure on it say it all? But apart from these extremes each of the subways fails on one or the other of the counts listed above. For example, the AIIMS one on security, cleanliness and drainage; Sansad Marg on security and cleanliness and South-ex on general maintenance (leaking roof during monsoons).

Part of the inefficient rendering of services can be explained by the laxity of the government officials in enforcing the terms and conditions of the contract and imposing the penalties when violation occurs, but the other part can be explained by the incomplete incentive structure applicable to the contractors.

While the incentive to perform well lies in avoiding the penalties, but there exists no direct force to propel the contractors to give it their best- no direct monetary gain that accrues to them. On the other hand, if the tendering is on the ‘Maintain Operate Transfer’ (MOT) basis then the genesis of the propelling force becomes easy. Under this scheme, the contractors would be given the maintenance responsibility but along with it the privilege of selling the advertisement rights in the subway to various agencies. A part of the revenue obtained from this exercise would go to the concerned government department of course. So here the contractor would know that to obtain the best advertisements he will have to project the subway as a viable and suitable location. Thus, the incentive to maintain will be inbuilt in the incentive to obtain (revenue)!

Once the maintenance issues are tackled to ensure enough footfalls one needs to look into the cost that accrues to the shop-owners in form of the rent that they have to pay to acquire the operational rights of the shops. In the subways constructed by NDMC the shops are allotted through tenders. The monthly rent differs from subway to subway and from shop to shop within a subway. In the AIIMS subway for instance a chemist shop is paying as high as Rs 4.5 lac per month. In spite of such high rent obligation he is happy with the state of his business. This is evident from the fact that he barely has time to talk to anyone except his customers!

In the same subway, however, is a shop that sells mats, garments, utensils and other general utilities. This is an example of a business that is not doing well as it is not suited to the environment and location of the subway. Connecting the AIIMS and Safdarjung hospital the subway has been able to provide a thriving market only for Chemist shops, PCO and STD booths and small confectionary shops.

While this is a case of businesses doing reasonably well, the case of the subway at south-ex is different. In spite of the tremendous potential it has to attract good business, being located in the middle of two busy markets, the 22 shops that the subway houses are not occupied. They all lie vacant since 2002 just because of one reason: the policy to rent them out is still under formulation!

Another peculiar case is that of the subway at Bahadur Shah Zafar Marg. Built in 1995 by the MCD and DTTDC this subway housed the Media Coffee Home- a government owned café. It has been more than 5 years now that the café is shut. What led to its failure seems to be the division of responsibility between the two authorities. The MCD had the responsibility of the maintenance of the subway and nothing to do with the coffee home whatsoever. DTTDC on the other hand was solely responsibly for running the café. Running a shop in the subway and expecting good business, cannot be separated from the responsibility of maintaining the subway in good condition to attract customers. It was this division of responsibility and separation of incentives that led to the failure of the café. And now, along with the failure of the Café there has been a failure in the incentive of the authorities to maintain it as well. It is dark and dirty to the extent of repulsion.

Having noted the deficiencies of government regulation- namely delay in policy formulation and lack of incentives to fulfil responsibilities a case can be made for private participation. The government is already seeking private help in maintenance of the subways and has itself pointed out the benefits of the same. But this is again a situation of incomplete incentives where the contractor has no inherent benefit accruing to him by executing his responsibility in the best possible manner.

Consider the option of private agencies providing pedestrian facilities by building and operating the subways. Given the fact that subways are a public good, its private provision may not be the most feasible option since the private entrepreneur cannot easily and cost effectively charge for its usage. And if he does charge, then the whole purpose of the subway construction will remain defeated. As it is reluctant to use the subways, people will get another reason to avoid using them. But if private developers are allowed to set up subways with shops in them which they can rent out or sell, this essential public good can be provided free to the pedestrians by the markets. In this manner the inefficiencies of public provision can be overcome. Also the problem of division of responsibility and incomplete incentives can be kept at bay!