Jan 18, 2017

Railways to rope in private players to modernise 23 stations


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File photo of Howrah station.

HIGHLIGHTS
  1. The railways has decided to rope in private companies to redevelop and modernise 23 stations
  2. Sources said the cost of redevelopment is expected to be around Rs 4,000 crore .
NEW DELHI: The railways has decided to rope in private companies to redevelop and modernise 23 stations, including the iconic Howrah station, Mumbai Centraland Chennai Central.

The first private sector-driven redevelopment plan at Habibganj (near Bhopal) is expected to be flagged off by Prime Minister Narendra Modi shortly, paving the way for seeking participation for the other 22 projects, most of them British-era facilities.
Bansal Construction will redevelop Habibganj station at Rs 400 crore, spending Rs 100 crore for redeveloping the main station and the rest for creating secondary facilities.

Apart from the 23, contracts for redevelopment of at least two stations in Delhi, Anand Vihar and Bijwasan, are expected to be finalised by March, sources told TOI. Faridabad in the National Capital Region is also on the modernization list.

While the government had cleared a plan to redevelop 44 stations last January, not much progress has taken place on the ground with the development of Gandhinagar having been kicked off earlier this month. But the development is not driven by the private sector and is instead through a special purpose vehicle with equity from the railways and the Gujarat government. With the railways moving slowly on getting private players, the state and the central government stepped in.

But now, officers said, things have been firmed up with the Boston Consulting Group conducting feasibility study for 55 stations and 23 are ready for award. The maximum number of projects are expected to be in Mumbai where apart from Mumbai Central, Bandra, Borivali, Lokmanya Tilak in Kurla and Thane, which was the terminus for the first ever train in the country — are on the list.

Sources said the cost of redevelopment is expected to be around Rs 4,000 crore and the government will earn at least Rs 4,000 crore as upfront fee from the developers which bag the rights. Apart from modernising the railway station, the developer will also get the rights to develop surplus land near the station, including building of hotels and other facilities. The lease will be for 45 years.

The overall investment is estimated to be in the region of Rs 25,000 crore, a source said. - TOI