The Railway Ministry has set up a multi-disciplinary committee to study and recommend broad guidelines that should be adhered to for all projects that involve partnerships with private firms.
The committee will submit its recommendations on February 7, which would then be considered in a meeting of the “full Railway Board”.
The Ministry may have to approach the Cabinet again for approval of bid documents if there are wide deviations from those bid documents for which a Cabinet nod already exists.
The move is important because the decision will have an impact on the pace of implementation of large projects – setting up of locomotive and ancillaries manufacturing units at Madhepura, Marhowra, Dankuni and Kachrapara. Companies eyeing these projects include GE, EMD (now Caterpillar), Bombardier, Alstom and Siemens.
“The magnitude of private participation projects envisaged by the Railways – be it in locomotive units, coach factories, building rail links – is huge. So, we have set up a cross-functional team to formulate policy documents. These would be a set of basic guidelines to ensure that the Railways' long-term interests are protected,” Mr Vivek Sahai, Chairman, Railway Board, told mediapersons on Wednesday evening.
‘Assured offtake'
The committee would go through guidelines laid down in General Financial Rules (which are basic Government guidelines for officials) and the joint venture-/public private partnership-related instructions of the Ministry of Finance and Planning Commission. Based on these, they would suggest model documents specific to the needs of the Indian Railways, particularly in the context of “assured offtake” models. The assured offtake models provide commitments to the joint venture units of assured purchases over long durations.
“Compared to the Cabinet-approved bid documents, we realised that some of our documents had ended up having 371 changes, and some, over 200, after bidders' inputs in the pre-bid conferences. We have to ensure that there are no major deviations. If there are major deviations, we have to approach the Cabinet again,” said Mr Sahai.