BackUser charges under station redevelopment programme to be inflation-linked
The formula for the user charge will be inflation-linked, SK Lohia, Managing Director and Chief Executive Officer of state-owned Indian Railway Stations Development Corp. Ltd (IRSDC) said on Tuesday.
PremiumThe railway ministry is working on the definition of the ‘user charge’ that will be levied on passengers for using revamped stations under the government’s ambitious station redevelopment programme. The formula for the user charge will be inflation-linked, SK Lohia, Managing Director and Chief Executive Officer of state-owned Indian Railway Stations Development Corp. Ltd (IRSDC) said on Tuesday.
A pre-determined user charge on passengers, income from real estate as well as charges levied on vendors for setting up of kiosks on the platforms will be will be key revenue streams for the concessionaire of the redeveloped stations.
“User charge will be a pre determined charged linked to inflation and will be clearly stated in RFP (request for proposal) document…so that (private) companies are able to make a financial model based on it," Lohia said at a virtual briefing. IRSDC is spreaheading the station redevelopment programme.
“There can be inflation or deflation…The charge needs to be linked with market realities," he said.
Indian railways’ ambitious station redevelopment plan is one of its attempts to attract private investment in the sector. Apart from transforming stations, railways also plans to attract private sector investment by offering such companies to run passenger trains.
Earlier this month railway board chairman Vinod Kumar Yadav had told Mint that redevelopment of of Habibganj, Bhopal and Gandhinagar stations is likely to be completed year-end. “For 50 more stations, the tender will be finalized in this financial year. The six tenders that have been opened got a good response. This is another way of financing the development of the stations to make it world class, without putting any money from the government," Yadav had said in an interview.
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