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Railways must get private partners, says committee

Railways must get private partners, says committee

New Delhi: An expert committee set up to suggest funding patterns for rail projects has recommended that Indian Railways seek bids for proposed diesel and electric locomotive component factories from private companies and forge a joint venture with the private sector for a planned coach manufacturing facility in West Bengal, all within one year.

The panel has suggested stiff targets, with physical work on the projects to start within 60 days and project execution within 365 days.

The committee, whose initial report was submitted to the railway ministry last week, has suggested that the railways offer an assurance that it would purchase components for around 100 diesel and electric locomotives each year for 10 years. A copy of the report was reviewed by Mint.

The diesel locomotive factory, in its first phase, would make components for rail engines being manufactured by Diesel Locomotive Works, a production unit of Indian Railways. Fabrication of bogies may be taken up in the second phase, the report said.

The unit should come up on 80 acres of railway land, which the national transporter should lease to the factory operator for appropriate amounts, it suggested.

The rail coach factory in Kanchrapara in West Bengal should be taken up as a joint venture with private companies, with the railways holding 26% equity in the project, the report recommended.

The electric locomotive assembly and ancillary unit for the railways’ Chittaranjan Locomotive Works in West Bengal, proposed to be set up on 100 acres of leased railway land, would build locomotive car bodies and other components.

These were among several new projects announced by railway minister Mamata Banerjee in her first budget under the United Progressive Alliance administration in July.

Railway officials said work on the projects had already started.

“It is a stiff target. We have to work towards it," said a senior Railway Board official who didn’t want to be named.

Several private companies had shown interest in taking part in one of the projects at a meeting called to discuss it, the official said.

The first phase of the committee’s recommendations has focused on large railway projects announced this year, such as the railway component factories as well as the proposed multifunctional complexes and world-class railway stations.

Some government officials have in the past questioned the composition of the 15-member committee, which includes Railway Board officials, two venture capitalists and union representatives.

The committee will decide on funding patterns for almost all major railway projects, including freight terminals, logistics parks, the proposed Delhi-Mumbai industrial corridor to be developed alongside a dedicated freight corridor, as well as a 1,000MW power plant in West Bengal.

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