Sonnagar-Dankuni freight corridor section likely to get aid from World Bank

The Eastern Dedicated Freight Corridor (EDFC) between Sonnagar in Bihar to Dankuni in West Bengal is likely to get World Bank backing, even if the project is implemented under the public-private partnership (PPP).

The 538-km stretch is estimated to cost Rs 15,000 crore. This is in addition to the 1192-Km Ludhiana (Punjab) to Mughalsarai (Uttar Pradesh) stretch that has been funded by the World Bank. Out of Rs 30,358 crore, the World Bank is giving Rs 13,625 crore for the project. 

The Dedicated Freight Corridor Corporation (DFCCIL) will be inviting private participation for the Sonnagar-Dankuni stretch.

“The Railway Board is finalising the PPP model and a RFQ (request for qualification) is likely to be out soon. We have already acquired 89 per cent of the land required for this stretch,” said an official.  Even if the planned PPP section -- covering 282.22 Km from Dankuni to Gomoh as Phase-I and 256.58 Km from Gomoh to Sonnagar as Phase-II – does not get enough interest from private players, DFCCIL is in talks with state-run Coal India Ltd to execute the project. The Dankuni to Gomoh phase is likely to cost Rs 7,527.22 crore.

The official added the World Bank is likely to finance it, even if a private player shows interest in the tendering stage. DFCCIL has conducted roadshows in various cities in which both domestic and global private sector majors showed interest for the project. This includes Russian Railways, Reliance Industries (RIL), Tata Projects, Adani Ports and Logistics, GMR Infrastructure, Mitsui, Siemens, and KEC International.

On the other hand, the Western DFC (WDFC) is being partly funded through a loan of Rs 38,722 crore from Japan International Cooperation Agency (JICA) out of the project cost of Rs 51,101 crore. The remaining part of the project cost for both the corridors is funded through gross budgetary support from the government of India as an equity contribution.

The government has increased the pace of work on DFCC. As against the total award of contracts of Rs 12,749 crore between 2009-2014, contracts worth Rs 39,638 crore have been awarded in the 2014-2019 period.

Earlier, DFCCIL has come out with an annuity model, based on which the private partner will get a minimum yearly return of around Rs 2,140 crore for the private players, irrespective of the traffic handled by the EDFC. According to government estimates, EDFC will carry around 264 million tonnes of traffic and WDFC another 284 MT over a period of 20 years. The eastern section is also projected to handle 100 rakes per day in both directions by FY 2045.

ON FAST TRACK

• 1856 Km: Eastern Dedicated Freight Corridor from Ludhiana to Dankuni 
• 1504 km: Western Dedicated Freight Corridor from Dadri to Jawaharlal Nehru Port Trust 
• Rs 81,400 crore: Total project cost