Railways to soon invite bids from firms to operate passenger trains

Indian Railways, in a first, plans to offer private players the opportunity to run 150 modern trains based on a revenue-sharing model, the bids for which will be invited in the next two weeks, Railway Board chairman Vinod Kumar Yadav said on Monday.

The move will end the national transporter’s monopoly, at least to the extent of running trains.

The revenue-sharing model is preferred by the government these days as it is less controversial than profit-sharing models.

The trains to be run by the private operators will offer world class technology and services to passengers to improve their train journey experience, according to the plan of the national transporter. As of now, 100 routes have been identified.

The Railway Board, the apex decision making body of Indian Railways, in October formed an empowered group of secretaries to define the modalities of the bidding process and take decisions to ensure award of projects in a time-bound manner that would ultimately permit private companies to operate 150 passenger trains.

The committee comprises Yadav, NITI Aayog chief executive officer Amitabh Kant, urban affairs secretary Durga Shanker Mishra, and economic affairs secretary Atanu Chakraborty, and other officials . “Five meetings (of the committee) have already taken place. The next meeting will take place soon,” Yadav said.

According to the plan, the infrastructure, maintenance, operations, and safety will be handled by Indian Railways, private train operators can take trains on lease and provide better on-board experience and services to the passengers, in terms of food, comfort, and entertainment. Official details are yet to be released.

Allaying fears of privatization of the railways, an entity with 100% government control and having 1.2 million employees, Yadav said that “privatization is out of question”. “It is not even in our thinking,” he said.

“There are some routes such as Delhi-Mumbai and Delhi-Kolkata, where paths are available. This will enable us to run more trains on such routes. That is the whole idea of private operators (running trains),” he said.

To get an experience of managing the idea of trains run by private operators, the tourism and catering arm of the national transporter, Indian Railway Catering and Tourism Corp. Ltd (IRCTC), launched the state-of-art high speed Tejas Express in October.

Tejas trains run on two sectors—Lucknow-Delhi and Ahmedabad-Mumbai. Apart from offering improved services and facilities, all passengers travelling on Tejas trains will be given complimentary rail travel insurance of up to ₹25 lakh. Besides, in a first, IRCTC will also pay monetary compensation in case the train is delayed.

“It is estimated that an investment of ₹50 trillion will be required in railway infrastructure between 2018 and 2030. Given the annual capital expenditure outlays of the Railways is ₹1.5 trillion to ₹1.6 trillion, completing even all sanctioned projects would take decades. It is therefore proposed to use public-private partnership to unleash faster development and completion of tracks, rolling stock manufacturing and delivery of passenger freight services,” finance minister Nirmala Sitharaman had said in her 2019-20 budget speech.