Where shall the money come from Ask PSUs

Written by fe Bureau | New Delhi, Feb 26 | Updated: Feb 27 2008, 04:48am hrs
The Indian Railways Finance Corporation (IRFC), the financing arm of the railways, is expected to raise Rs 6,907 crore from the market to part-finance the Plan outlay of the Indian Railways during 2008-09. The money raised by IRFC is used for acquisition of rolling stock assets, and also for meeting other developmental needs of the Indian Railways.

Rail Vikas Nigam, a special purpose vehicle created to undertake project development, mobilisation of financial resources, and implement projects pertaining to strengthening of golden quadrilateral and port connectivity, will also raise Rs 293 crore for investment in various projects. The net railway Plan outlay of Rs 29,000 crore for 2008-09 excludes the funds raised by Indian Railways Finance Corporation, Rail Vikas Nigam, Rs 500 crore under Wagon Investment Scheme and Rs 800 crore as funding through public private partnership route.

As per the revised Budget estimates for 2007-08, Indian Railways Finance Corporation and Rail Vikas Nigam are likely to raise Rs 4,750 crore and Rs 240 crore, respectively. During the year 2006-07, the financing arm of the railways registered a turnover of Rs 2,284 crore and net profit of Rs 399 crore, taking the combined turnover of all the nine public sector undertakings (PSUs) of the Indian Railways at Rs 8,758 crore and net profit at Rs 1,366 crore.

The nine PSUs under the railways ministry had achieved a combined turnover of Rs 7,034 crore and net profit of Rs 818 crore in 2005-06. In the same fiscal, the Indian Railways Finance Corporation had registered a turnover of Rs 2,020 crore and a net profit of Rs 334 crore.

In 2006-07, Container Corporation of India Limited (Concor), which operates inland transport services, clearance, and cargo handling facilities throughout the country, registered a turnover of Rs 3,000 crore and earned a net profit of Rs 704 crore, while in 2005-06, the company had posted a turnover of Rs 2,489 crore with a net profit of Rs 526 crore.

Ircon International Ltd, which has won the biggest ever project of Rs 4,000 crore for construction of a rail line in Malaysia, also achieved its highest turnover of Rs 1,543 crore and net profit of Rs 76 crore. In 2005-06, Ircon, the only construction PSU awarded with the mini-ratna status, had achieved a turnover of Rs 1,113 crore and earned a net profit of Rs 81 crore.

RITES, the consulting division of the Indian Railways, booked a turnover of Rs 566 crore and earned a profit of Rs 118 crore in 2006-07. In 2005-06, RITES had registered a turnover of Rs 426 crore and a net profit of Rs 99 crore.

RailTel Corporation of India, the telecommunications arm of the Indian Railways, also became a profit earning company during fiscal 2006-07.