100% FDI gets green light for rly line projects
Private investors, ports, export/import companies, “other investors” and FDI will now be allowed in the railway lines meant to connect ports, industrial and logistical parks, and mines with other parts of the country. The railways will either award these projects (construction and maintenance) on nomination basis or select the investor through competitive bidding. A revenue-sharing model has already been worked out.
The move is expected to give a boost to a sector where infrastructure expansion will provide direct, tangible benefits to the economy. Currently, the PPP model in the railway sector is at a takeoff stage, with large domestic investments coming in a few areas or projects, including the Mumbai elevated rail corridor, private freight terminals and a slice of the eastern segment of the dedicated freight corridor. However, no FDI is allowed in these PPP projects and is limited to only manufacture of components.
Under a new policy for participative models in rail connectivity and capacity augmentation projects notified by the railway ministry, 100% FDI has been permitted under the approval (FIPB) route “for the development of first- and last-mile connectivity projects at either end of the rail transportation chain providing connectivity to ports, large mines, logistics parks”.
Under the policy, the railways will soon invite expression of interest from prospective investors.
Be the first to comment.