1. Indian Railways may give 90-yr lease to contractors to put world class stations on track

Indian Railways may give 90-yr lease to contractors to put world class stations on track

To reap the maximum benefit out of the station redevelopment programme, the railways ministry plans to increasingly lean towards a 90-year lease structure for developers.

By: | New Delhi | Updated: January 14, 2017 8:09 AM
railways The Indian Railways is all set to start work on the first railway redevelopment project at Habibganj in Bhopal.

To reap the maximum benefit out of the station redevelopment programme, the railways ministry plans to increasingly lean towards a 90-year lease structure for developers.

“If we increase the lease period to 90 years, the benefits multiply by 1.5 times. The current approval from the Cabinet is for 45 years…once we have tested the market with this current lot of 23 stations, in the next lot we will approach the Cabinet to allow us to lease for 90 years,” said a railway ministry official requesting anonymity.

The Indian Railways is all set to start work on the first railway redevelopment project at Habibganj in Bhopal, Madhya Pradesh, and simultaneously put 23 more stations up for tender, as reported by The Financial Express. The stations include Pune, Howrah, Kanpur Central, Chennai Central and Bandra Terminus, among others.

The railways plans to redevelop more than 400 stations on a public-private-partnership basis to upgrade stations and provide modern amenities such as cafes, walkways and holding areas to passengers. Under the current structure, a developer will get a commercial lease for 45 years and the maintenance contract will be provided for 15 years.

A 90-year lease formula has only been allowed for Surat and Gandhinagar, both in Gujarat, on a case-to-case basis.

Explaining the rationale, the official said, “If you sell land, you get the full potential value. However, if you lease for shorter period, you do not get that much revenue. Leasing for 90 years is as good as sold and you reap full potential.” He added the railways intends to lean more towards the 90-year lease period if Cabinet allows.

According to Arunendra Kumar, former chairman of the Railway Board, though 90 years is a long lease period, it may attract quality investment. “It may attract serious and good investors who will shell out more because they will have ownership for a longer period.

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He added whatever be the lease period, it should be ensured through clauses that the property returns to the railways after the expiry of the lease period.

The station redevelopment programme, which aims to monetise land assets around stations and the airspace, has attracted interest from entities from Malaysia, South Korea, Germany, France, Italy, the UK and Belgium.

— Reported by Saurabh Kumar

  1. A
    A.Subba Rao
    Jan 16, 2017 at 12:16 pm
    90 days lease is as good as selling
    Reply
    1. A
      A.Subba Rao
      Jan 16, 2017 at 12:17 pm
      90 years lease is as good as selling
      Reply
      1. K
        K Ramanujam
        Jan 14, 2017 at 4:04 pm
        leave alone station development what solution the railway minister has for regular late running of trains specially between Mumbai and Hyderabad vice versa. This is a decade old perennial problem with south central railway specially between wadi and hyderabad.
        Reply
        1. J
          John Eastwood
          Jan 14, 2017 at 8:08 am
          The train picture that you have shown is an Australian train, Indian Pacific. You have been putting this wrong photo always whenever there is a news relating to Indian Railways, correct this mistake.
          Reply
          1. G
            Girish
            Jan 14, 2017 at 9:16 am
            This an indication of privatization of Indian Railways .
            Reply
            1. R
              Rameswar Pattanayak
              Jan 14, 2017 at 3:38 am
              Each railway station should be converted to transportation hubs for man and materials. Holistic multimodal approach will succeed.
              Reply
              1. R
                rohan
                Jan 14, 2017 at 6:16 am
                Indian Railways on !
                Reply
                1. S
                  Sundaresan Srinivasan.
                  Jan 14, 2017 at 1:02 pm
                  Pune railway station is extra saturated >>>>>>needs relocation not redevelopment. There is no scope to add even one more platform to the existing 6 nos which were constructed by the Britishers in the 19th century. What is urgently required ....develop infrastructure viz., escalator, lifts (Similar to Thiruvanthapuram station ). Stinky smell greets pengers at Pune station ... railways should find some effective measure to eradicate this and not fake publicity in the newspaper that Pune station is now clean and cheat people.
                  Reply
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