Indian Railways (IR) – world’s largest locomotive operator – has decided to go ahead with its plan to handover 150 trains to private companies for operating trains
On Wednesday, the railway minister Piyush Goyal invited request for qualification (RFQ) from the private players to operate passenger trains in the country, a project that entails an investment of around Rs 30,000 crore.
IR had planned to invite qualifying bids in April, it got delayed after nationwide lockdown due to COVID-19 crisis.
This is the first initiative for private investment for running passenger trains on the Indian Railways network. It began last year with the Indian Railway Catering and Tourism Corporation (IRCTC) introducing the Lucknow-Delhi Tejas Express.
The train services will be operational on 109 origin destination(OD) pairs of routes through the introduction of 151 modern trains.
Majority of Trains to be manufactured in India (Make in India). The private entity shall be responsible for financing, procuring, operation and maintenance of the trains.
The routes have been formed into 12 Clusters across the Indian Railway network and each train shall have a minimum of 16 coaches.
The trains are to be designed for a maximum speed of 160 kmph, which will help in reduction of journey time. The concession period for the project shall be 35 years.
The objective of allowing private players to operate passenger trains is to introduce modern technology rolling stock with reduced maintenance, reduce transit time, boost job creation, provide enhanced safety, improve travel experience of passengers, and also reduce demand supply deficit in the passenger transportation sector.
Currently, the railways runs around 13,000 passenger trains on its network, but around 20,000 trains are required to meet the demand.
The private operator will pay to Indian Railways fixed haulage charges, energy charges as per actual consumption and a share in Gross Revenue determined through a transparent bidding process.
The 2019-20 budget had pegged the national transporter’s requirement of infrastructure investment at Rs 50 lakh crore over 12 years, thereby necessitating the involvement of private players in the sector.
This is definitely positive news flow and would open up the market for railway management to private sector players. This will help few large rail infrastructure and consultancy players like Titagarh, BEML. RITES. IRCTC and Temaxo which are likely to benefit significantly ahead
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