This is yet another railway project that seems to have gone off track. One of the largest landowners in the country,

Indian Railways, has shelved the plans to lease surplus land to private developers. The land development programme spread over 265 acre was estimated to generate over Rs 4,000 crore in this fiscal.

The decision comes after the railways withdrew tenders for two of its largest land development projects?the first in Sarai Rohilla in New Delhi and the other in Bandra in Mumbai. ?These were the two largest and most expensive sites. After cancelling their tenders we decided to stop inviting bids for other sites as well,? a Rail Bhawan official said.

Sources said there were a lot of issues at stake, which made the ministry rethink about going ahead with the project. The main problem was the 99-year concession period that the ministry felt was too long. It was also of the view that the bidding process was not transparent enough, especially for a project, which involved such large sum of money.

The Railway Land Development Authority was handed over 10 such plots in various cities including Delhi, Mumbai, Gwalior, Vishakhaptnam, Kanpur, Kolkata and Bangalore for leasing out to private developers. Along with using it for commercial activities, the developer was also expected to construct quarters for railway employees.

The 25-acre plot in Sarai Rohilla was bid out in April with a reserve price of Rs 675 crore. The authority had, in fact, already finalised the developer when it was directed by its parent ministry to cancel the tender.

Meanwhile, in Bandra the railways own an 11-acre plot near suburban railway station for which it put out for bid in June and set a reserve price of Rs 1,750 crore. The ministry?s decision will have larger ramifications as well. Indian Railways, which owns over 4.32 hectare, of which about 43,000 hectare is vacant, had in total selected 92 sites for the project.

After bidding out the 10 sites, it had planned to bid out another 31 land parcels later during the year. It was also carrying out site inspections and feasibility surveys for another 15 such sites.