At a time when the Prime Minister wants to give a push to infrastructure sector, the concession agreement for Railways flagship project – Dedicated Freight Corridor – is still awaiting nod from the Finance Ministry, now headed by Dr Manmohan Singh. This has irked the World Bank, which is part-funding the project.
The agreement has to be signed between the Railway Ministry and the Dedicated Freight Corridor Corporation of India Ltd (DFCCIL).
The agreement is one of the key requirements for the World Bank financing, which has signed a loan agreement for $975 million, for the Khurja-Kanpur section.
The agreement is an absolute must for the appraisal of next tranche of funding, which would be over $1.4 billion, for the Kanpur-Mughalsarai and Khurja-Ludhiana sections.
“The concession agreement is awaiting finalisation at the Department of Economic Affairs for about six months now. "It is one of the legal requirement for the loan,” Mr R.K. Gupta, Managing Director, DFCCIL, told Business Line .
Another Railway Ministry official said that the matter has been taken up with the Department of Economic Affairs. For the concession agreement - Indian Railways, the parent Ministry of DFCCIL - has proposed that the business model of the company will be such that it would not make significant profits. The revenue for DFCCIL would be the network access charge by the Railways, and the Indian Railways will book traffic and collect freight revenue for DFCCIL. Meanwhile, DFCCIL is moving ahead with its land acquisition and utilities clearance to prevent any further delays.
The dedicated rail freight corridor corporation will spend Rs 2,500 crore on shifting the utilities such as buildings, structures, signalling installations that come in the rail line’s route.
Mr R.K. Gupta said that they have tried their best to ensure that the existing train operations don’t get disturbed.
The DFCCIL route is parallel to the current Indian Railways track. There are places such as Hapur, Muzzaffarnagar, Saharanpur, where station dismantling may be required.
Also Palanpur and Mehsana in Gujarat will require significant dismantling.
We are already in touch with the Zonal Railways, costing done, and money deposited, Mr Gupta said.