Indian Railways is under the ownership of the Ministry of Railways, Government of India. This government-run organisation operates the world’s 4th largest National Railways System in the world. It runs about 13169 trains every day (long and short suburban routes), covering around 7325 stations all across the country.
Now Indian Railways has planned for a massive overhaul of the entire collection of its operating networks – the stations (urban, suburban, and rural); platforms; locomotive coaches, and engines. This massive boost has been announced by the Government of India under “Make in India.” The railways have announced and identified 2 major initiatives, namely:
- Running of passenger trains on the Indian Railways network by private operators
- Redevelopment of railway stations and their infrastructure across the country
According to estimates, a potential investment of over US$ 7.5 billion in the next five to six years has been earmarked for the development of the Indian Railways. Out of this, US$4 billion will be utilised for private passenger train services. The Ministry of Railways has launched the bidding processes for the above-mentioned initiatives and invited domestic as well as international investors to participate. According to the proposed contract, private investors will be wholly responsible for the design, procurement, maintenance as well operations of the train (locomotives) along with the set-up and upgradation of the yard area for locomotive maintenance. Furthermore, the investors will be responsible for the reliability, punctuality, regular maintenance, and upkeep of the locomotives.
Under the “Make in India” initiatives, the winning investors will have to source through domestic manufacturers. Indian Railways will distribute access to track and infrastructure, maintenance shed as well as locomotive washing lines. The guards and the locomotive pilot will be provided by the Indian Railways during the initial operating days.
Indian Railways recognised around 12 independent clusters with 109 origin-destination routes, where more than 151 passenger trains will be operated by private players. The private players will have the right to pricing, service, and operational flexibility. The investors will have the right to choose halts and the freedom to procure carriages and wagons all through domestic manufacturing.
According to the CEO of Niti Aayog, “The initiative by the Indian Railways to privatise the operation is a paradigm shift- which will rewrite the evolution story of the Railways of India.” The private players will operate using the Indian Railways’ existing infrastructure, which is a win-win situation for both the private sector and Indian Railways. “Make in India” to propel Indian Railways on the path to providing world-class travel experience.
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– Avishek Pyne
