15 Firms Submit Applications for Railways’ Private Train Project

October 2020
15 Firms Submit Applications for Railways’ Private Train Project

L&T Infrastructure Development Projects Ltd, IRB Infrastructure Developers Ltd, Bharat Heavy Electricals Ltd (BHEL), Cube Highways and Infrastructure III Pvt. Ltd, GMR Highways Ltd, PNC Infratech Ltd, Welspun Enterprises Ltd and Indian Railway Catering and Tourism Corp. Ltd are among the 15 firms that have submitted a request for qualification (RFQ) for public-private participation (PPP) in the operation of Indian Railways’ passenger trains.

Construcciones y Auxiliar de Ferrocarriles or Grupo CAF, the Spain-based manufacturer of railway vehicles, equipment and Solaris brand of buses, is also in the list of notable applicants for the private train project.

The application process that was opened on Wednesday, registered Asia’s second-largest rail transporter receiving 120 applications for 12 clusters.

The Ministry of Railways had invited RFQs for private participation in the operation of passenger train services for the clusters comprising 140 origin-destination pairs of routes through the introduction of 151 modern trains for operations.

The highest number of RFQs (12) were received for the Mumbai-2 and Delhi-2 clusters. These are followed by the Bengaluru (11), Delhi-1, Prayagraj, Secunderabad and Jaipur (10), and Mumbai-1, Chandigarh, Howrah, Patna and Chennai (9) clusters, respectively.

This is the first major initiative of attracting private investment for running privately managed passenger trains on the Railways’ route network. The Railways expects the project to entail private sector investment of about Rs 300 billion.

“The private entities for undertaking the project would be selected through a transparent two-stage competitive bidding process comprising a request for qualification (RFQ) and request for proposal (RFP),” said a railway ministry spokesperson.

“The Ministry of Railways will expeditiously complete the evaluation of applications and RFP documents will be made available to the qualified applicants by November 2020. The ministry has targeted to award all the clusters by February 2021,” the spokesperson added.

Improve Services, Introduce Modern Technology
The Railways had earlier said the initiative seeks to improve the availability of transportation and introduce modern technology rolling stock and other services to improve the overall travel experience of passengers. Participation of multiple operators in train operations will help create competition and improve service delivery.

The Railways has also provided the details of passenger traffic being handled on the routes that are being bid to applicants. This was done to facilitate applications to undertake the necessary due diligence before the commencement of the bidding process.

The ministry had also clarified that trains to be operated under the project can be either purchased or taken on lease by private entities. Risks concerning the operation of trains would be allocated to the parties in an equitable manner.

These trains are going to run on the routes where there the demand for train services are higher than the existing capacity. The driver and guard of the trains will be railway officials, and the safety clearance of trains will be taken care of by the Railways.

Each train shall have a minimum of 16 coaches. This private train project is the first initiative of private investment for running passenger trains.

A majority of trains would be manufactured in the country under the Central Government’s ‘Make in India’ programme. The private entity shall be responsible for financing, procurement, operation and maintenance of trains.

The trains shall be designed for a maximum speed of 160 kmph for a substantial reduction in journey time. The running time taken by a train shall be comparable to or faster than the fastest train of Indian Railways operating on that route.

The RFQs for 12 clusters were published on July 1.

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