To aggressively woo private investors to set up terminals in greenfield and brownfield sidings.
The Railways is set to revamp its private freight terminal (PFT) policy to woo more private investors. Though it has primarily plugged the gaps through the revised PFT policy in June, it is still open to tweaking the details to make it simpler for interested parties.
“The Railways would go in for revamping of the freight marketing schemes to pursue the private investors aggressively,” said Dinesh Trivedi, minister of railways.
The policy will allow the Railways to invite investors to set up PFT in greenfield and brownfield sidings. The PFT would be developed by private party on private land to handle freight traffic moved by trains.
Greenfield means, a new PFT commissioned on private land under the provisions of this policy, while brownfield means a terminal commissioned by the conversion of an existing siding or terminal etc on the private land to PFT.
| KEY CHANGES MADE IN THE PRIVATE FREIGHT TERMINAL POLICY IN JUNE Only outward loading of non-programmed (piecemeal) traffic of coal for core and non-core sector is allowed Private siding/terminals set up on private land on the Railways’ network and where third party cargo has already been permitted will have to apply to become brownfield PFT and would be governed under this policy Removal of the clause to show original papers of land ownership or lease before approval Subsidiaries and joint ventures of private companies allowed to set up platforms for handling third-party freight Railways would consider the net worth of only the holding company/lead partner of the JV Source: Indian Railways |
“For greenfield investors, the concern is likely to be land procurement issues, as it is a long process. The successful completion of PFT is expected to be done within a stipulated time frame, which otherwise, would lead to forfeiture of the entire amount of Rs 1 crore along with the cancellation of the approval,” said a person representing one of the applicants for a brownfield PFT.
Para 3.8 of the PFT policy after the June revision says, “Private siding terminal setup on private land on the Railways’ network, and where third party cargo has already been permitted (on co-user basis or otherwise), shall also have to apply to become a brown field PFT and be governed under this policy.”
The logic behind introducing this compulsory clause was to plug the revenue loss with the diversion of traffic from the existing goods sheds to private sidings, and increase earnings.
Para 4.4 of the PFT policy says the facility required to handle two rakes should be minimum three. The number of lines should be increased in proportion to the number of rakes to be handled. "The clause to change private siding into a brownfield PFT and the minimum land and line requirement to be called a PFT cannot be necessarily followed at the same time. It is not necessary that the private siding might have a suitable land stretch nearby to construct a requisite structure," said a brownfield applicant on the condition of anonymity.
Another concern is that even after examining the commercial viability of changing private siding into PFT, the private siding owner might not be interested in making the required investment to handle all kinds of traffic.
"Though there are clauses that are limited in nature, the Railways as an organisation is behaving in a very commercial manner to address those concerns,” said an applicant.
According to a railway official, “The railway board is collating responses from every zone and will follow a flexible approach to address the genuine concerns of the interested parties."
The objective of PFT policy is to expand the network of freight handling terminals with the participation of private sector, and enhance the presence of share of the Railways in the overall transport sector of the country.
