Rly to rope in pvt players for electrification

With spiralling energy costs turning out to be a major challenge for the cash strapped railways, the transporter is planning to rope in the private sector for electrification of tracks in an attempt to reduce its energy bill and dependence on imported fuel.

The state-owned transporter will soon launch a pilot project to garner private investment in the sector. As per the plan, the private player will be handed over tracks to electrify, operate and maintain on annuity basis. The private players will be compensated with fixed annual payments for the investments. “Many private players and PSUs have shown interest as the project is bankable,” Kul Bhushan, member (electrical), railway board, told TOI.

“It will be a win-win situation for railways and private players as the gap between cost of diesel and electricity is widening,” Kul Bhushan said, adding, “Railways will be able to compensate private players with funds saved from shifting from diesel to electric traction.” While there is huge delay in several rail projects, the transporter exceeded the target for electrification of 4,500 km track during the 11th fiveyear plan (2007-12) and electrified 4,556 km.


Railways invites states to share costs of rail projects

A cash strapped Railways, has given a “standing invitation” to all states to share costs of Rail projects which states may consider “essential” but which the Railways considers “unremunerative”. Bansal who was bombarded with questions in the Rajya Sabha over the inordinate delay in completion of Railway projects, first reminded MPs over the “vociferous demands” made by them for new projects and how it was financially difficult for the Railways to cope up with them and deliver results. A frank Railways minister thereafter praised Opposition ruled Karnataka for coming forward and sharing the cost of Rail projects with the Centre. The minister then urged that states “should bear the cost of land and 50 per cent of the total cost of construction.”

Interestingly, Congress has taken charge of the Railways portfolio after a long period of 16 years. A fact that Samajwadi Party MP, Naresh Aggarwal stated while congratulating the new Railway minister saying “after a long time of captivity (the ministry) has finally been unshackled”, in an obvious hint to the ministry having become a hostage to the whims of political parties and coalition partners like the TMC and prior to that the RJD.

Pawan Bansal, who appears to have already started taking stock of pending rail projects and how to expedite them, then added that he had already “written a good many letters to some of the Chief Ministers, requesting them that in such cases, they should bear the cost of land and 50 per cent of the total cost construction.” In a recent step, Haryana had come forward for offering to share the cost of one project. Taking this cue, Bansal went onto to urge Congress ruled Rajasthan to follow Haryana’s example. Responding to the repeated complaints by an MP from the state, Bansal in turn urged him to “persuade the Government of Rajasthan to share the cost that way.”

A prudent Rail minister sensing the political compulsions of state governments for whom certain local projects assume immense significance but which translate into little financial viability or commercial logic for the Railways ministry, seems to have found a mid path between the two.

His proposal urging states to come on board and bear the cost of land and 50 per cent of the costs, would thereby help in meeting both the needs of the state government as well as of the cash strapped ministry.
The Railways at present requires Rs 1,47,187 crore for 347 projects under three categories — new lines, gauge conversion and doubling according to the minister.


CIL may join Ircon-Rites in rail project

As part of its product evacuation plan from Mozambique, Coal India is considering a proposal to join the Ircon International and Rites-led consortium constructing and rehabilitating the civil war ravaged rail system in Mozambique. Both Rites and Ircon are subsidiaries of Indian Railways.

According to sources, the Rites-Ircon have recently approached CIL to pick up participatory stake in the Beira Railroad Company engaged in rehabilitating, operating and upgrade 850 km long rail line in central Mozambique, including Beira Port, to carry 12 million tonnes of coal annually at an estimated cost of $440 million.

The Rites-Ircon duo holds 51 per cent controlling stake in the consortium.

Confirming the development, a senior CIL official told Business Line that the rail system would be of immense importance for evacuation of coal from Mozambique to India.

The official, however, stressed that a decision in this regard was still awaited. Efforts to secure comments from Ircon in this regard, remained unsuccessful.


Published in: on March 10, 2009 at 4:26 pm  Leave a Comment  
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