BackRailways plan to tap stakeholders to raise funds, implement projects
Suresh Prabhu proposes collaboration with new stakeholders—from state governments to state-run and private sector firms
Premium(PTI)
New Delhi: Taking a cue from the recommendations of the 14th Finance Commission, railway minister Suresh Prabhu projected an investment plan that will be implemented in collaboration with new stakeholders—from state governments to state-run and private sector firms.
While presenting the railway budget for 2015-16, Prabhu proposed to set up joint ventures with state governments for “focused project development, resource mobilization, land acquisition, project implementation and monitoring of critical rail projects".
“I am happy to share that most of them have conveyed their acceptance to our proposal," he said in his rail budget speech.
The centre wants to emphasize cooperative federalism by working with the states, he said later at a media briefing. The 14th Finance Commission report tabled in Parliament on Wednesday stressed the importance of cooperative federalism.
Besides, Prabhu said, the railways will use the expertise of public sector units (PSUs) under the ministry to hasten the completion of projects. It will form joint ventures with PSUs that are its “customers for meeting their requirements of new lines".
“Such focused execution of works will ensure faster completion and ultimately provide the much-needed path for them to transport their produce and at the same time generate revenues for railways," he said. “Our high-density networks are congested, over-strained and capacity-constrained. Our customers are dissatisfied. Our key customers like the coal, steel, and cement industries need new lines to transport their wares."
On Thursday, the centre proposed a plan outlay of ₹ 1 trillion, an increase of 52% over the revised estimate for 2014-15. Of this, the railways will borrow ₹ 17,655 crore as extra budgetary resources, an increase of about 46.5% over the estimate for 2014-15. The remaining plan outlay includes ₹ 17,793 crore to be raised from internal resources and ₹ 5,781 crore from public-private partnerships.
Hemant Kanoria, chairman and managing director of Srei Infrastructure Finance Ltd, said the rail budget has laid out a “road map for partnerships with both state governments and private sector" that will serve as “principal building blocks for this year’s rail budget".
Rajeev Jyoti, chief executive of the rail business at Larsen and Toubro Ltd, said raising funds from various sources is a creative move and that “it has sent a strong message but needs to be translated into action".
Former railway minister and Congress party leader Pawan Kumar Bansal said the previous United Progressive Alliance government, too, had tried to involve states. “We had cleared five participator models where mine owners and port owners were to construct rail lines from ports or mine heads to main railway lines," he said. “Involving the states was actually done by us. We did not call them SPVs (special purpose vehicles) but our partnership with states was nothing less than that."
Prabhu said his key objective was to transform the railways and significantly expand its network. He also said the government will put more emphasis on manufacturing commodity-specific wagons such as automobile carriers—a move that will prompt manufacturers to reduce their dependence on roads.
Mayank Aggarwal and Gaurav Mishra contributed to the story.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
