Indian Railways is rapidly consolidating its position and staging a spectacular turnaround largely due to efficient utilization of resources through increased wagon-loads strictly sticking to its time schedules, and more rational pricing. An investment outlay of Rs. 2,510 billion has been proposed for the Eleventh Plan period, of which around 67% is proposed to be mobilized through the internal generation and extra-budgetary resources. Huge opportunities are in the offing in the form of the upcoming dedicated freight corridor (DFC) and the Delhi-Mumbai Industrial Corridor running along with it, as well as the metro rail projects in about a dozen selected cities of the states.
Infrastructure is being upgraded by way of new railway line projects, gauge conversion, doubling, construction of terminals and logistic parks. As per the Eleventh Five Year Plan Working Group Report, the total fund required for capacity enhancement projects during the plan period is Rs. 544 billion, apart from Rs. 70 billion for national railway projects.
In addition, huge construction opportunities are also available for rail-road connectivity and other capacity augmentation projects being undertaken by the Rail Vikas Nigam Limited (RVNL). Major opportunities opened up in the modernization projects of 26 railway stations, including those of Delhi and Mumbai to be upgraded on the PPP model. The Indian Railways has decided to attract private investments by allowing areas around stations and above platforms to be commercially developed. This includes separation of operational passenger handling areas from the proposed commercial space as is the case in airports with an estimated investment of about $500 million each.
Vitally, this segment has not been affected by the ongoing global financial crisis because they are funded by the government directly from its own resources. The only noticeable impact that can be seen in the segment is the slowdown in freight traffic, which may affect the internal resources of Indian Railways.
That apart, the Dedicated Freight Corridor (DFC) is said to be the biggest venture of Indian Railways to date, envisaging construction of dedicated freight lines on the eastern and western sides of the country, covering 2,729 km through seven states. The two corridors will be interlinked at Khurja and will require a total investment of Rs. 372.18 billion. A special purpose vehicle (SPV), DFC Corporation of India (DFCIL) was set up in 2006 to implement the project with a paid-up capital of Rs. 500 million.
Source: nbmcw
