New Delhi: Railway Minister D.V. Sadananda Gowda Tuesday listed four new ways to mobilise resources to upgrade and expand projects in his maiden budget.
According to Gowda, the cash-strapped railways will mobilise resources to create and upgrade infrastructure through the funds of railways’ state-run public sector companies (PSUs).
He said large-scale private investment, including foreign funds, will be invited into the sector.
The fund inflows for modernisation of railway infrastructure will also be generated through promoting public-private partnership (PPP) models.
“Railways will interact with industry and take further steps to attract investment under PPP through BOT (build operate transfer), and annuity routes and 8 to 10 capacity augmentation projects on congested routes will be identified for this purpose,” Gowda said.
The zonal railways will be suitably empowered to finalise and execute such projects through PPP mode.
The railways have taken up port connectivity on priority through PPP mode of funding.
“Railways will facilitate connectivity to the new and upcoming ports through private participation,” Gowda said.
Currently, in principle approval has been granted for building rail connectivity to Jaigarh, Dighi, Rewas, Hazira, Tuna, Dholera and Astranga ports under the PPP model amounting to over Rs.4,000 crore.
The minister added that a planned tax holiday scheme which will give incentives for investment in railway projects with a long gestation period will also be promoted.
Currently, the Indian Railways is facing a huge cash crunch of Rs.26,000 crore amidst a decline in growth in passenger earnings.
In the interim budget, Mallikarjun Kharge, the then railway minister, had set a revenue target of Rs.1.65 lakh crore that included Rs.1.06 lakh crore from goods tariff and Rs.45,255 crore from passenger fares and the balance from other sources.
Recently, the new government increased railway passenger fares by 14.2 percent and freight carriage charges by 6.5 percent. However, it will need more funds from international lenders to finance long gestation projects.