The Hindu Business Line : Be my guest, says Indian Railways

Yatri seva
Budget hotels will be built on BOT basis
Bids for eight locations cleared, 16 more in the offing
Four Yatri Nivas hotels chosen for revamp

New Delhi , Dec 28

And now the Railways wants to provide you good hospitality using its landholdings. It has awarded land and property to players such as the Taj Group, Royal Orchid and the Essel Group to develop budget hotels on a build, operate and transfer (BOT) basis.

Having decided on bids for eight locations, the Indian Railway Catering and Tourism Corporation (IRCTC) plans to firm up bids for 16 more over the next few weeks. The hotels would be commissioned over the next one-two years.

Of the eight locations, four have Rail Yatri Nivas hotels, which would be refurbished by the hotel groups and operated for 15 years before being handed back to Railways. The Rail Yatri Nivas in New Delhi would be developed by the Taj Group with a capital investment of about Rs 8 crore. The Taj Group would pay back Rs 8 crore to IRCTC spread over 15 years. The Rail Yatri Nivas at Ranchi and Puri have been awarded to the Patna-based Chanakya Hotel Group while the one at Howrah will be with Visakhapatnam-based Meghalaya Hotel.

"Spread over 15 years, we would get about Rs 15 crore from the hotel at Ranchi; Rs 7-8 crore from Puri, and around Rs 2 crore from Howrah," said Dr P.K. Goel, Managing Director, IRCTC.

The amounts vary based on the location, investment required to refurbish and the size of the hotels — while the Howrah hotel has only 37 rooms, the one at Delhi has about 100 rooms. These four hotels would be commissioned over the next year.

IRCTC has also handed over Railway land at Bikaner, Darjeeling, New Jalpaiguri and Sealdah for construction of hotels on BOT basis for 30 years. Zoom Developers, along with Royal Orchid, would build hotels at Bikaner, Darjeeling and New Jalpaiguri, while the hotel at Sealdah would be built and operated by Essel Group Company PAN India Paryatan Ltd. "These hotels should be commissioned over the next two years. The companies would invest about Rs 15-20 crore in setting them up and pay back roughly Rs 1 crore per year for the 30-year period," said Dr Goel.

A part of the revenue share accruing to IRCTC from the above projects would go to Indian Railways as it owns the land. IRCTC has also acquired some land at Bhubaneswar, where it would invite bids for setting up a hotel, said Dr Goel. The entire revenue would accrue to IRCTC from this project, as it is the landowner.

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