NATIONAL RAIL
VIKAS YOJANA
Nitish Kumar*
The Government has
drawn up an important non-budgetary investment initiative for
the development of Indian Railways, to be called the National
Rail Vikas Yojana (NRVY). The programme was launched by the Prime
Minister on December 26, 2002.
Under this, all
the capacity bottlenecks in the critical sections of the railways’
network will be removed at an investment of Rs. 15,000 crore over
the next five years. These projects include strengthening the
Golden Quadrilateral to enable the Railways to run more long-distance
mail and express trains and freight trains at a higher speed of
100 kmph, at a cost of Rs. 8,000 crore, strengthening of rail
connectivity to ports and development of multi-modal corridors
to hinterland, at a cost of Rs. 3,000 crore,construction of four
mega bridges -two over the river Ganga, another over the Brahmaputra,
and one over the Kosi river at a cost of Rs. 3,500 crore.
Golden Quadrilateral
Projects
The High
Density Network (HDN) that connects the four metro cities of Delhi,
Kolkata, Chennai and Mumbai, including the diagonals, is popularly
called the Golden Quadrilateral. Though comprising only 16 per
cent of the network, it carries 65 per cent of the freight traffic
and 55 per cent of the passenger traffic. Therefore, it forms
the main arteries of the Indian Railways network.
This network,
however, is saturated in many sections. Some of the sections are
single line, some are non-electrified, while others have track
structures unfit to carry freight trains at higher speeds. Also,
on certain sections additional capacity build-up is required by
providing more lines.
The Indian Railways
proposes to give a thrust to strengthening of the Golden Quadrilaterals
by undertaking doubling of single line patches and laying multiple
lines wherever required, particularly at approaches to the metros
for segregation of suburban and long distance traffic, reduction
in speed differential between freight and passenger trains by
raising the speed of freight trains to 100 kmph. For this purpose,
works such as induction of improved rolling stock (locomotives
as well as wagons), electrification, inputs in fixed infrastructure
like track, overhead equipment and signalling grade, separation
at level crossings, construction of grade by-passes at busy junction
stations and passenger terminal stations, speeding up of slow
passenger trains and other such options are planned. Terminals
and junctions are also proposed to be modified.
In view of the
urgent need to create additional capacity on the Golden Quadrilateral,
it is necessary that the works in progress and the new works are
completed in the next five years. In order to ensure this, and
to access funds from the market, it is proposed to create a Special
Purpose Vehicle (SPV) to carry out the functions to undertake
resource mobilization, both from domestic market and multilateral
and bilateral funding agencies, undertake project development
and execution of works, commercialization of projects, if considered
necessary and found feasible, and creating project-specific SPVs
for individual works, if required.
The Cabinet has
approved the formation of an umbrella Special Purpose Vehicle
(SPV) for execution of National Rail Vikas Yojana. A company called
Rail Vikas Nigam Ltd. has been registered on January 24, 2003.
Mega Bridges
The Indian Railways
proposes to construct four mega bridges—two over the river Ganga
(Monghyr and Patna), one over the river Brahamputra (Bogibeel)
and one over the river Kosi (Nirmali)—at a total cost of Rs. 3500
crore.
The rail bridge
on the Ganga will connect Dighaghat with Sonepur in Bihar and
provide an important rail connection between the main line and
the routes on the North-Eastern and Northeast Frontier Railways.
The rail-cum-road bridge on the Ganga at Monghyr will provide
connectivity between south and north Bihar and to the north-east
region. The rail bridge on river Kosi between Nirmali and Bhaptiahi
will form an essential link in the north-east region. The rail-cum-road
bridge on the river Brahamputra will be provided at Bogibeel to
form an important link with the north Assam region.
All these four
bridges have economic and social significance as they will bring
about an appreciable improvement in the social set up of the region.
It has been decided that these mega bridges will be implemented
in a time-bound manner through an SPV mechanism and funds for
execution of these projects will be raised from the market. It
is also felt that the Ministry of Roads and Highways should be
the equity partner along with the Ministry of Railways in the
SPV since two of the bridges also involve road bridges. The toll
charges on road users and surcharge on rail users will form the
revenue stream of the SPV. In case of shortfall in revenue to
meet the debt servicing liabilities, a transparent subsidy will
have to be considered by the Ministry of Finance to the SPV.
A detailed financing
and investment banking report for the SPV has been prepared. As
per an earlier Rail India Technical and Economic Services (RITES)
report, the toll and surcharge revenue has been assessed in the
range of Rs. 20-30 crore per year per bridge. It is proposed to
award a study by RITES to reassess the figures of both traffic
expected across the bridges and the level of toll/surcharge that
the users are willing to pay. On account of the large project
cost and long gestation period, interest during construction will
form a significant component in the overall project cost and the
value will depend on the debt-equity ratio. The debt-equity ratio
has, therefore, to be decided upon.
Port Connectivity
Strengthening
of rail connectivity to ports has become necessary due to growth
in the port traffic. It has, therefore, been planned to strengthen
rail connectivity to major ports and to develop multi-modal corridors
to the hinterland. This initiative will involve strengthening
of the existing routes as well as laying of tracks along new alignments.
Development of
multi-modal corridors to the hinterland is being carried out for
the use of multi-modal transportation system that may involve
running of double stack containers and carrying of bulk iron ore
traffic from the originating points to the major ports.
Projects estimated
at Rs. 3000 crore have been identified in line with this strategy.
Funding of
NRVY
An Asian
Development Bank (ADB) loan amounting to Rs. 1,500 crore has been
tied up.ADB has also indicated the possibility of considering
second and third loans during 2006 and 2008 respectively, depending
on the fulfillment of laon covenants of the first loan. Another
Rs. 1,500 crore is expected as Gross Budgetary Support (GBS)
Dialogue with
the World Bank has been started for funding the mega bridges and
other NRVY projects. The World Bank has accepted Indian Railways
reform agenda.(PIB Features)
*Minister
of Railways
