PM-EAC Paper Finds Metro Expansion Improves Household Financial Discipline in Indian Cities

A working paper by the Economic Advisory Council to the Prime Minister (PM-EAC), co-authored by Soumya Kanti Ghosh, Pulak Ghosh, and Falguni Sinha, finds that metro rail expansion in Indian cities like Hyderabad, Bengaluru, and Delhi improves household financial discipline. Metro access is linked to lower mortgage delinquency rates and higher loan prepayments, as well as reduced new vehicle purchases. The study suggests metro systems enhance household liquidity and contribute to financial stability by lowering transportation costs and easing debt servicing.