Private sector keen to participate in rail infra development

The Union Railway Minister, Sadananda Gowda, said, there has been growing interest from both domestic and foreign companies to develop rail infrastructure, commercial space and new freight corridors, and also for upgradation of stations.

Speaking after a meeting with officials of the South Central Railway, Gowda stressed the new government’s focus is on implementation and delivery of projects already announced rather than taking up new ones.

Addressing the concerns expressed by some railway unions with regard to foreign direct investment (FDI) in the Railways, he said the FDI would focus on non-core areas such as the creation of new infrastructure for high-speed trains and dedicated freight corridor and not active operational areas.

He said that “The requirement for finances is huge and the Railways has revenues of about INR 30,000 crore and gross budget support of INR 30,000 crore, together accounting for INR 60,000 crore. This is a meagre amount given the huge finances required to implement the existing projects, estimated to require about INR 5,00,000 crore.”

As a result, the government was compelled to strive for FDI in Railways and also private sector participation in rail infrastructure development.

Simultaneously, surplus land available with the Railways will be put up for development of infrastructure through private sector and foreign companies participation.

FDI in railway operations

He added that “There is huge interest in the private sector to be part of development in the Railways.”

Elaborating on agreements signed with China, Mr Gowda said they cover upgradation of rail stations, speeding up of trains, upgradation of the rail network to international standards and setting up of a railway university.

Further, the Minister said that it has been proposed to offer about 10 stations to the private sector for development in phase one. A model agreement is under preparation and is likely to be ready in a few months, he pointed out.