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Mamuni Das

New Delhi, Oct 6

A consortium comprising IL&FS, Halcrow Consulting, Australian-legal firm Blake Dawson and Railways’ subsidiary RITES will advise Dedicated Freight Corridor Corporation of India Ltd (DFCCIL) on the level of track access charges that it will receive from the Indian Railways.

DFCCIL is a special purpose vehicle formed to plan, develop, mobilise funds and construct, maintain and operate the dedicated rail freight corridors. To start with, the freight corridor will have 2,762 route kilometre of rail links — Eastern corridor (Ludhiana to Sone Nagar) and Western Corridor (Jawahar Lal Nehru Port, Mumbai to Tughlakabad/Dadri). The two corridors will interlink at Khurja.

Track access charge is the amount that the Railways will pay to DFCCIL for using its track infrastructure. For example, if certain goods are transported from point A to point B and the entire distance includes 40 per cent of Indian Railways’ tracks and 60 per cent of the dedicated freight corridor, then the revenues earned from that operation would have to be accordingly apportioned between the two organisations.

These charges are expected to be the key source of revenue for DFCCIL.

DFCCIL will sign the agreement with the consortium (IL&FS, Halcrow Consulting, Blake Dawson and RITES) over the next few days. The consortium would also advise DFCCIL on the concession agreement that it will sign with the Indian Railways. Simply put, the concession agreement is like a contract that will define the rights and responsibilities of both the parties.

The Western corridor will be built with an estimated expenditure of Rs 23,680 crore. The Railways expects to put in Rs 6,200 crore from internal accruals, Rs 1,250 crore from gross budgetary support, and raise Rs 16,230 crore as debt. The Railway Ministry is trying for Japan Bank for International Co-operation (JBIC) funding for this project.

JBIC has said it would consider funding only if the Western corridor is built on electric traction. JBIC further says it would “first consider” the loan only for the Rewari-Vadodara section of the corridor.

The Eastern corridor will be built at an estimated cost of Rs 19,613 crore. Of this, Rs 7,800 crore will be through internal generation, Rs 1,250 crore through gross budgetary support and Rs 10,563 crore will be raised as debt from multilateral agencies such as the World Bank and the ADB.

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