Mamata pushes for PPP, pulls plug on privatisation
Business Standard, Feb 25, 2010
Ministry to seek private investment for world-class stations, auto hubs and high-speed passenger train corridors.
As expected, Railway Minister Mamata Banerjee has sought private sector capital in various areas of operation while clarifying that this does not tantamount to privatisation.
“I would like to assure my railway family (comprising 1.4 million employees) that we are not going for privatisation of the railways. I do not believe in privatisation or corporatisation. Railways will continue to be a government department,” she said in her Budget speech which had over a dozen mentions of public-private partnership, or PPP.
The ministry will seek domestic investment though the PPP mode for a range of activities like building world-class stations, auto hubs, manufacturing units of rolling stock, multi-modal logistic parks, high speed passenger train corridors, port connectivity and laying new lines.
There was no estimate of the private sector investment sought, though industry officials estimate the opportunity to be worth thousands of crores of rupees.
“Domestic investors have tremendous scope in railways and that will be our hope in the future. It will facilitate a large quantum of investment and provide ready business to investors. Therefore, it will be a win-win option for all,” said Banerjee in her speech which was decidedly business-friendly.
Since the railways have not been very successful in attracting private investment so far, she promised to facilitate and expedite private sector investment through a special task force, which would clear investment proposals within 100 days.
“In creating infrastructure with private capital, we will create wealth for all,” she said, adding that the policy guidelines would be made easy and investment-friendly.
A few multi-level parking complexes are proposed to be taken up as pilot projects under the PPP route during the current year.
Banerjee has also proposed to start — using the PPP route — six bottling plants at Ambala, Amethi, Mal, Nasik, Farakka and Thiruvananthapuram, to provide fresh water to travellers at rates lower than the Rs 12-13 per bottle charged by the leading players.
This apart, the minister plans to set up a rail axle factory at New Jalpaiguri in West Bengal through the PPP mode to achieve self-sufficiency in axle manufacturing.
To augment the capacity of wagon production, she proposed five state-of-the-art wagon factories in joint venture or PPP mode at Secunderabad, Barddhaman, Bhubaneswar/Kalahandi, Guwahati and Haldia.
Given the plethora of demands from various state governments, Banerjee said “railways will consider on priority new proposals from state governments for construction of rail infrastructure in their states if they agree to funding on PPP basis.”
The six proposed high-speed passenger rail corridors — which will allow trains to run at 250 to 350 km per hour — will also be executed through the PPP mode.
A refrigerated container factory would be set up in the PPP mode at Budge Budge near Kolkata to help the movement of perishable farm produce, Banerjee added.
The railways’ optic fibre network is also proposed to be extended — to the last mile — through the PPP mode.
Experts, however, maintain a guarded approach to Banerjee’s ambitious plans to attract private investment.
“We are talking about investments running into thousands of crores. Some definitive timelines, rather than statements of intent, would have better indicated her seriousness to attract private investment,” said Amrit Pandurangi, leader-infrastructure practice, PricewaterhouseCooper.
100-day limit to clear PPP plans
Asian Age, Feb 24, 2010
New Delhi, Feb. 24: Railway Minister Mamata Banerjee on Wednesday said her ministry is setting up a task force to clear proposals from the private sector through the public-private partnership (PPP) mode within 100 days.
"Sometimes they (business community) have problems. They are keen to invest, but their proposals are unduly delayed by a typical negative approach," she said, adding that the Railways needed to develop a business culture to attract "private investment" and the matter would be discuss at the highest level.
"I will discuss with the Prime Minister, finance ministry and Planning Commission regarding early clearance of projects," she said.
Ms Banerjee announced "a special task force to clear proposals for investments within 100 days". Stressing the need for "new business models", Ms Banerjee said: "We are inviting domestic investment through PPP mode in areas like new lines, world-class stations, auto hubs and high-speed train corridors."
The minister said domestic investors had tremendous scope in the Railways, and "will be our hope in the future". But she also clarified: "I would like to assure my railway family that we are not going in for privatisation of the Railways. It will remain a government organisation."
The minister announced that 10 stations — Ambala Cantt, Bolpur, Ernakulam, Gorakhpur, Jammu, Jhansi, Kharagpur, Kota, Surat and Thane — would be converted into world-class platforms.
The airspace over stations in large cities will be leveraged to build multi-level parking complexes through the PPP route. "A few pilot projects will be taken up during the year," the minister added.
To provide drinking water, the Budget proposes to start six bottling plants in Ambala, Amethi, Mal, Nashik, Farakka and Thiruvananthapuram through the PPP route with the mandate that bottled fresh water "will be provided at stations at much cheaper rates".
Ms Banerjee also announced setting up a Diesel Multiple Unit (DMU) factory in JV/PPP mode at Sankrail, West Bengal, and five state-of-the-art wagon factories in collaboration with the private sector at Secunderabad, Burdwan, Bhubaneshwar/Kalahandi, Guwahati and Haldia.
Odisha gets half of what it demanded
The Pioneer, Feb 25, 2010
PNS, Bhubaneswar
The State's demand for allocation of at least Rs 1,805 crore towards railway development in the 2010-11 Railway Budget has been ignored. It has got about Rs 836.64 crore as against Rs 715.22 crore for 2009-10. It would be spent for construction of new lines, gauge conversion, doubling and electrification. In addition, Rs 65.53 crore have been sanctioned for undertaking traffic facilities work at various stations located in the State. In total, the State has got Rs 902.17 crore.
This includes Rs 430 crore for completion of the ongoing new lines and Rs 399.73 crore for doubling of the major rail tracks. The good news is that Rs 120 crore has been sanctioned for the Khurda- Balangir railway project, Rs 101 crore for Haridaspur-Paradeep, Rs 75 crore for Daitari-Bansapani and Rs 50 crore for Talcher-Bimalagarh project.
In the Railway Budget for 2009-10 the State had asked for Rs 1,504 crore, but it was allocated only Rs 715 crore, of which only Rs 653.22 crore was released. The Budget has proposed to update the surveys for the Phulbari-Berhampur, Puri-Konark, Gunupur-Theruvali and Jeypore-Malkangiri rail routes. In addition, survey will be made for new train lines in the Talcher-Phulbani-Lanjigarh and Gunpur-Theruball-Junagarh-Jeypore routes. The only new line project that was included in the Budget is Digha-Jaleshwar.
Railway Minister Mamata Banerjee has proposed to set up one of the State-of-the-art wagon factories in joint venture or public-private partnership (PPP) mode either at Bhubaneswar or Kalahandi. Similarly, for rail connectivity to the new minor ports coming up at Astranga, Chudamani and Gopalpur, the Railway Minister has proposed PPP mode. The following new lines are expected to be completed during the year 2009-10: Lanjigarh-Bhawanipatna portion of Lanjigarh-Junagarh line. The following sections are expected to be completed in 2010-11: Bhawanipatna-Junagarh of Lanjigarh- Junargarh & Khurda-Begunia of Khurda-Bolangir.
The Budget had made provisions of 10 Duronto trains in the Railway Budget 2010 including five for West Bengal while there will be one Duronto Express between Howrah and Puri.
Out Patient Department (OPD) and diagnostic centres will be set up at Balugoan, Bhadrak, Bhubaneswar, Bramhapur, Jajpur-Keonjhar Road, Kantabhanji, Kesinga, Khurda Road, Koraput, Rayagada, Sambalpur, Titlagarh, Visakhapatnam and Vizianagaram stations. Secondary-level General Specialty Hospitals will be set at Bramhapur, Kantabanji, Koraput, Palasa, Rayagada & Visakhapatnam stations of the East Coast Railways.
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