<p>The Centre on Tuesday said that offshore funding for Indian Railways would be encouraged only for infrastructure development, not operations.<br /><br /></p>.<p>The clarification comes against the backdrop of the government considering foreign direct investment (FDI) in Railways, a move that had ruffled a few feathers.<br /><br />As the Railways faces a severe resource crunch, hampering the implementation of pending projects, it plans to bring in FDI in select sectors, such as high-speed train systems, dedicated freight lines, for building coaches, tracks and stations, electrification and commercial development of vacant lands.<br /><br />At present, there is a complete ban on any kind of FDI in the Railways, except for mass rapid transport systems. <br /><br />Union Railway Minister D V Sadananda Gowda, who held a discussion with Commerce Minister Nirmala Sitharaman recently, sought the Commerce Ministry’s help to get FDI.<br /><br />“There is no question of allowing foreign companies in the operation part of the Railways,” Gowda told Deccan Herald here.<br /><br />He said that the Railways needs Rs 5 lakh crore for modernisation and clearing of pending projects. A large chunk of that sum will come from the private sector, he added.<br /> <br />A section of railway employees had cautioned the government against considering FDI for Railways, and apprehended that the national carrier would move towards privatisation in the long run.<br /><br />But they also fear that mass privatisation will result in loss of jobs for them.<br /><br />Dismissing this fear, Gowda said since the government requires huge funds for modernisation that will lead to better services, the ministry is planning to allow FDI.<br /><br />However, “there is no question of allowing FDI in the operation of Railways,” he added. <br />Sources said the Railways is preparing a draft Cabinet note, which would be finalised after consultations with other ministries.</p>
<p>The Centre on Tuesday said that offshore funding for Indian Railways would be encouraged only for infrastructure development, not operations.<br /><br /></p>.<p>The clarification comes against the backdrop of the government considering foreign direct investment (FDI) in Railways, a move that had ruffled a few feathers.<br /><br />As the Railways faces a severe resource crunch, hampering the implementation of pending projects, it plans to bring in FDI in select sectors, such as high-speed train systems, dedicated freight lines, for building coaches, tracks and stations, electrification and commercial development of vacant lands.<br /><br />At present, there is a complete ban on any kind of FDI in the Railways, except for mass rapid transport systems. <br /><br />Union Railway Minister D V Sadananda Gowda, who held a discussion with Commerce Minister Nirmala Sitharaman recently, sought the Commerce Ministry’s help to get FDI.<br /><br />“There is no question of allowing foreign companies in the operation part of the Railways,” Gowda told Deccan Herald here.<br /><br />He said that the Railways needs Rs 5 lakh crore for modernisation and clearing of pending projects. A large chunk of that sum will come from the private sector, he added.<br /> <br />A section of railway employees had cautioned the government against considering FDI for Railways, and apprehended that the national carrier would move towards privatisation in the long run.<br /><br />But they also fear that mass privatisation will result in loss of jobs for them.<br /><br />Dismissing this fear, Gowda said since the government requires huge funds for modernisation that will lead to better services, the ministry is planning to allow FDI.<br /><br />However, “there is no question of allowing FDI in the operation of Railways,” he added. <br />Sources said the Railways is preparing a draft Cabinet note, which would be finalised after consultations with other ministries.</p>
