State govt to increase built-up area on railway land

State govt agrees to increase built-up area on railway land

Pushing for the formation of a special purpose vehicle for the suburban railway project in Bengaluru, the state government has written to the Centre, agreeing to increase the floor space index (FSI) for railway land while suggesting the financial structure for the SPV.

Monday's letter was in response to Railway Minister Piyush Goel's statement that the Centre would share 50% of the project cost (instead of the earlier 20%) if the state government increased the FSI of railway land to 1:5. The present index is 1:2.5 and the change would provide for an increase in the built-up area.

Mahendra Jain, Additional Chief Secretary, Urban Development Department, one of the nodal officers for the project, said the in-principle agreement was subject to local conditions. "The hike in the FSI for each parcel of the railway land will be subject to local conditions," he added.

The letter says the Karnataka Railway Infrastructure Development Corporation (K-RIDE) could be used as the "vehicle for the constitution of the SPV", similar to the Hassan Mangalore Rail Development Company Limited.

Officials said the state and Centre could later decide to make the suburban joint venture an autonomous SPV along the lines of the Bangalore Metro Rail Corporation Ltd (BMRCL).

Fare autonomy

According to the proposal, the state and the Centre will each fund 20% of the SPV through budgetary allocation while the remaining 60% will be raised through borrowings. The liability for the borrowings will also be shared on a 50:50 basis.

Karnataka has sought fare autonomy saying a free hand in fixing the fares will also increase the SPV's potential to raise resources for the project.

Officials said the doubling of the Baiyappanahalli-Hosur line at a cost of Rs 376 crore and the Yeshwantpur-Channasandra line at a cost of Rs 170 crore would be treated as separate projects. Works under the state government's recent sanction of Rs 1,745 crore will be excluded from the suburban project, they said.

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