Panel puts rly upgrade cost at Rs 560,000 cr

A Sam Pitroda-led expert group report on Monday said the railways would require Rs 560,000 crore for modernisation over the next 10 years.

The Report on Modernisation for the railways said out of the requirement, Rs 396,000 crore would be required in the XII Plan and Rs 164,000 crore in the XIII Plan. To meet the funding, the panel said Rs 2,50,000 crore should come as gross budgetary support (GBS) from the government, Rs 2,01,806 crore from internal generation, Rs 1,01,000 crore from borrowings, Rs 2,29,024 from public-private partnerships, Rs 24,000 crore as dividend rebate and Rs 16,842 crore from road safety fund.

On doubts about the quantum of GBS, Railway Minister Dinesh Trivedi said, “If the railways has to grow and contribute two per cent to the country’s GDP, the central government needs to have a paradigm shift in their approach towards investment in the rail infrastructure.”

In advanced nations, he said, the governments contribute 50 to 60 per cent of the investment without any dividend payment.

Trivedi said that the railway ministry would be doing their part of the job by raising Rs 40,000 crore annually as internal generation and Rs 45,000 from public-private partnerships. But Trivedi could not elaborate how the railways would raise that money.

One of the members of the expert group, who did not want to be named, said, “Even if the railways does not want to raise fares, internal generation would be much dependent on whether the GBS of Rs 50,000 crore annually is invested on the fixed infrastructure.”

The internal generation of Rs 40,000 crore is based on the assumption that the railways would get its bulk traffic from roads by expanding its infrastructure (route km), modernising signaling and providing enough rolling stock to cater to the unmet demand. Otherwise, it is just wishful thinking, he added.