Railways’ Rs 16,000-cr eastern corridor project back on track

Apr 08 2014, 13:41 IST
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SummaryStuck for over two years due to lack of investor interest, the R16,000-crore Son Nagar-Dankuni...

Stuck for over two years due to lack of investor interest, the R16,000-crore Son Nagar-Dankuni section of the eastern freight corridor is finally set to take off with the railways planning a request for qualification (RFQ) document by June.

The 530-km stretch to be built on public-private partnership (PPP) has been marred by delays. After holding several investor meetings and adding initiatives like flexible viability gap funding (VGF), the railways is now hoping for a good response to the RFQ. The project is expected to be awarded by the end of the year.

“We'll be coming out with the RFQ document by June. The contours of the documents are being finalised,” Railway Board chairman Arunendra Kumar told FE.

A new traffic forecast report for the project, which is encouraging for the potential investors, has been prepared by CRIS and the financial planning of the corridor, which has been broken into two slices — Dankuni-Gomoh (276 km) and Gomoh-Son Nagar (264 km) —has been done by the UK-based consultant Grant Thornton. The report gives capital structure, revenue model and the financial viability of the project.

The route would primarily be carrying coal and iron ore traffic in the Dhanbad, Raniganj and Jharia regions. The stretch is a part of the 1,839-km eastern freight corridor, which runs from Ludhiana in Punjab to Dankuni in West Bengal.

The Son Nagar-Dankuni project is directly being monitored by the PMO and despite several deadlines, the railways have failed to find an investor for the project, which could delay the completion of the R80,000-crore dedicated freight corridors (3,300 km), running on the eastern and western flanks of the country.

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