Indian Railways to invest $532BN, says Suresh Prabhu

Addressing the CII National Council meeting recently, Suresh Prabhu, Minister of Railways mentioned that huge investments required to achieve the ambitious targets of investments to the tune of $532 billion (Rs.8.5 lac crores) would be made available through the use of innovative measures using both budgetary & off budget allocations.suresh prabhu

Major areas include creation of a healthy bond market, access funds both from the domestic and foreign investors, leveraging the balance sheets of the rail PSUs, monetizing the land & other assets of railways, attract the states to partner railways & bring in the additional allocations made to them from the central taxes.

Power & Petroleum PSUs were also expected to come forward with investments in railways to cater to their logistics requirements.

Elaborating on the implementation agenda, he mentioned that priority was accorded to the low gestation quick success projects like doubling, tripling of lines, electrification & signaling, adopting technology so that railways can not only cater to its own requirements in the country but also start exploring export opportunities in the neighboring nations.

He further highlighted that railway despite being one of the largest buyers of electricity, at present, buys it at a fairly expensive rate, which has tremendous scope of improvement. These would be looked into carefully in order to rationalize expenditure, creating savings to plough back into railways.

Echoing the sentiments, he mentioned that Railways is keen to deepen the participation of private sector in railway. In the budget, Railways has introduced an independent dispute resolution mechanism.

During the interaction members emphasized on the need for better risk-reward sharing in PPP projects, using land as equity component, restructure the Railways – with separation of policy making, management & operation roles and further empowering of Zonal Railways to take tender related decisions.

Prabhu stated that the time for the Indian economy to take off was now, it needs to harness the opportunities of US economy growing at 3-4%, Chinese slowdown. The thrust of the government is to finance and boost infrastructure which is an imperative to make manufacturing in India attractive.