Policy for pvt investment in Rlys okayed

In a major move to open up railways to private players, the Cabinet Committee on Infrastructure (CCI) on Thursday approved a  policy framework for private participation in rail connectivity and capacity augmentation projects. The proposal was put forward by the Ministry of Railways.

The policy contains five models, namely, Non-Government Railway, Joint Venture with equity participation by Railways, capacity augmentation through funding by customers, Build-Operate-Transfer (BOT) and BOT annuity.

The latter two (BOT and BOT annuity) will follow the existing appraisal and approval procedure laid down by Ministry of Finance through PPP-AC route. Model agreements will be prepared for all these models.

“The policy framework and the private participation models for rail connectivity and capacity augmentation projects suggested would facilitate speedy execution of rail connectivity projects. This will give a boost to industrial development of the country and significantly enhance freight traffic of railways,” the government said in a statement.

“It would also bring out the synergy of public private partnership and help railways in significantly increasing their freight volumes and the industries in benefiting from efficient rail transport,” it said.

Earlier in the day, Minister of State Adhir Ranjan Chaudhary informed Lok Sabha of the projects which are being considered for private investment. They include dedicated freight corridors, loco and coach manufacturing units, elevated rail corridor (Churchgate, Mumbai), private freight terminals, terminal development scheme, development of automobile and ancillary hub, liberalised wagon investment scheme, wagon leasing scheme, automobile freight train operators scheme, special freight train operator scheme and port connectivity.

He also said that Memoranda of Understanding (MoUs) have been signed with Belgium, Austria and Spain for cooperation for effective development and modernisation of Railway sector in the country. The cooperation includes consultation for modernisation of railway stations, introduction of high speed, signalling and others, he said.