Anil Ambani Group company Reliance Infrastructure Ltd, which recently started investing in the defence sector, is also planning to bid for the Railway Ministry’s station improvement projects.
Railway Minister Suresh Prabhu had made the announcement on redevelopment of stations for provision of better passenger amenities in the Railway Budget for the current financial year.
The Ministry has identified over 400 busy stations, including Dadar and Kurla in Mumbai, for redevelopment. It has not disclosed the project cost but industry calculations suggest that each station would need at least ₹60 crore for development.
A senior company executive told BusinessLine, on condition of anonymity, that when the management took a call on investing in new businesses, defence, railways and smart cities were the three big sectors identified for fresh investments and future growth.
The executive said that the Rail Ministry would not allow an increase in passenger fares and a few billboards would not earn enough revenues. Therefore, money could only come from monetisation of the land and existing amenities around the stations,
Better amenities such as chargeable retiring rooms, shops, lounges and restaurants suitable for all budgets could be created at the stations.
But RInfra would only be looking at projects that were less capital intensive, with immediate revenue flow, the executive added.
Special purpose vehicle
A special purpose vehicle, Indian Railway Stations Development Corporation Ltd (IRSDC), which is a joint venture between Ircon International Ltd and Rail Land Development Authority, both under the Ministry, has been created.
A senior Railway Ministry official said that the ₹8.5-lakh-crore railway infrastructure modernisation plan has been attracting a number of private companies.
IRSDC has roped in one of the top global consulting firms to prepare a business plan for station modernisation.
Architecture firms have also been appointed to redesign the stations.
The plan will be ready by March 2016, after which bids would be called in phases, the official said.