The Hindu Business Line : Rlys to seek CCEA nod for freight corridor SPV

Track notes
SPV will be in charge of infrastructure, including tracks and signalling system.
Railways will take care of maintaining rolling stock.
Revenues from operations will accrue to the Railways.
Railways will pay access charges to SPV for using infrastructure.

RAILWAYS ON track for freight corridor.

New Delhi , May 22

Railway Ministry is likely to move a proposal on the organisational structure and financing pattern of the special purpose vehicle (SPV) to be formed for the dedicated freight corridor to the Cabinet Committee on Economic Affairs (CCEA) for its nod within two weeks.

"We would be approaching the CCEA with a proposal on the SPV to be formed for the dedicated freight corridor within two weeks," said Mr J.P. Batra, Chairman, Railway Board, on the sidelines of the Conference of Chief Secretaries on Public Private Partnership in infrastructure here. He added that the paper is in its final stages of preparation.

structure, methodology

The proposal would be on the "kind of structure, methodology of functioning, with a general idea about financing (of the SPV)," said Mr Batra.

Reiterating the Railways would have a majority stake in the SPV, he said the SPV would be in charge of infrastructure including tracks and signalling system. But Railways would take care of maintaining the rolling stock.

He indicated that the revenues for operations would accrue to Indian Railways (IR), which in turn would give access charges to the SPV for that portion of the journey for which the infrastructure of the dedicated freight corridor is used.

"The business would be dealt by IR. The station at which goods are loaded and unloaded would belong to IR. IR would pay them (the SPV) access charges for using their infrastructure," said Mr Batra.

He also said a consultant - RITES - has been appointed for preparing the business plan for the SPV. It includes working on issues such as the expenditure, sources of income, and criteria for calculating access charge for the freight corridor.

Investments seen higher

Mr Batra also said the freight corridor is likely to entail investments of "much higher" amount than the initial estimates of about Rs 20,000 crore.

The Eastern Corridor, to be based on electric traction, would have higher or adjustable schedules of dimension than that of Railways' tracks at present.

Earlier in the conference, Mr Batra had said the Railways had requested the States to help clear last mile projects, where 60 per cent of works have been completed, followed by those projects that would help increase the throughput of Railways, when it comes to resource allocation. State Governments can also participate in the multi-modal logistics hubs projects that Railways is working on.