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Opportunities for Public-Private Partnerships in Railways

Opportunities for Public-Private Partnerships in Railways. 20 th May 2006. Background. High Growth Rate of Economy will generate Huge Transportation Demand Pressure on existing Rail Network calls for Expansion of Capacities Reducing cost of operation will require keeping pace with Technology

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Opportunities for Public-Private Partnerships in Railways

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  1. Opportunities forPublic-Private Partnerships in Railways 20th May 2006

  2. Background • High Growth Rate of Economy will generate Huge Transportation Demand • Pressure on existing Rail Network calls for Expansion of Capacities • Reducing cost of operation will require keeping pace with Technology • Capacity generation and Modernization will require Mobilization of Huge Funds • More than Rs. 47,000 Crores required to complete almost 240 sanctioned Projects

  3. Public Partnership in Rail Infrastructure Projects Background • State Government offered Financial Participation • Navi Mumbai connectivity through CIDCO in 1986 • Creation of Konkan Railway Corporation in 1990 with State initiatives • Sub-urban Projects in Mumbai, Chennai and Kolkata

  4. Public Partnership in Rail Infrastructure Projects Participation of States through SPV for financing Projects • Karnataka • K-RIDE • HMRDC • Maharashtra • MRVC • Gujarat • Kutch Railway Company

  5. Public Partnership in Rail Infrastructure Projects Cost sharing in Rail Infrastructure Projects • Jharkhand -6 projects • Karnataka -3 Projects • Maharashtra- 3 Projects • Tamil Nadu- 3 Projects • West Bengal-1Project • Andhra Pradesh- 1 Project • Haryana- 1 Project

  6. Rail Projects through PPP • Surendranagar-Pipavav Gauge Conversion (PRCL) • Pipavav Rail Corporation Limited • Connectivity to Pipavav Port • Gandhidham-Palanpur Gauge Conversion (KRC) • Kutch Railway Company • Improving Connectivity to Mundra & Kandla Port

  7. Recent Initiatives • Private parties to run container trains • Wagon Investment Scheme • Development of Rail-side Warehouses & Logistic Parks • Strengthening Rail –Port Connectivities • Development of Dedicated Freight Corridors

  8. Private Operators for Container Operation • Sector Opened in 2006 • Licenses offered for various corridors (Exim & Domestic) to 14 players • Rs 540 Crore generated as fees • Generation of Terminal & Wagon Capacity • ROR of approximately 20% for investors

  9. Wagon Investment Scheme • Launched in 2005-06 • Wagon procurement • Guaranteed supply of rakes for loading • 10% rebate on freight charges • Rs 250 crore generated from 25 Rakes

  10. Development of Rail Side Warehousing • Door-to-Door service • Land at nominal fees by Railways • 5% minimum revenue to be shared with Railways • Lease period 30 years • MoU with CWC has been signed to set up rail side warehouse at 22 locations. Agreement finalised for 10 locations

  11. Development of Logistics Parks • Objective: • Complete logistics solution • Reduction in Door Bridging Cost • Development of multi-user/ multi-commodity rail handling and warehousing facilities • State Government are invited to participate in the venture

  12. Port Connectivity Works • Rail Connectivity provided to Mundra and Pipavav Port • Connectivity Strengthened for Mundra , Kandla and Mangalore Port • Strengthening / New Port Connectivity through SPV route being explored for Paradip, Krishnapatnam, Dahej and Hazira Ports by RVNL

  13. Dedicated Freight Corridors • Capacity Augmentation considering growth in Container ,Coal, Iron &Steel • 2700 km Corridor on Eastern & Western Routes will cost Rs. 22,000 Crore • Incremental Traffic of 97 million tonne and 4 million TEU projected by 2021-22 on both corridors

  14. Traffic Projections *Trains indicated each way. **Trains on Western Corridor is inclusive of Bulk and Container

  15. Dedicated Freight Corridor Ludhiana-Son Nagar Nagal Dam Amritsar with Extensions to Durgapur/Bokaro/Tatanagar Chandigarh Ludhiana Ambla Legend: Bhatinda Saharanpur Main Route Panipat Feeder Route Meerut Hapur Harduaganj Khurja Tundla Kanpur Unchahar Mughal Sarai Allahabad Son Nagar Paricha Gomoh Asansol Katni Durgapur Tata Nagar Bondamunda

  16. APPROXIMATE STATE-WISE LENGTH OF TRACK AND COST OF DEDICATED FREIGHT CORRIDOR ON BOTH WESTERN & EASTERN ROUTES * Kilometerage in States on account of extension of Eastern Corridor to Kolkata. No cost estimate has been made for the extension between Sonnagar-Kolkata.

  17. Challenges Ahead • Massive Capacity Augmentation ahead of Demand • Resource Mobilisation • Induction of appropriate technologies in Rolling Stock • Reducing Unit Cost of Operation

  18. Opportunities under PPP for State Governments • Rail Connectivity to SEZ • Logistics Hubs • Financing of remote area projects • Warehousing/ICD’s • ROB/RUB’s • Rail Connectivity to Minor Ports

  19. Thank You

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