All Rail Coaches to have Bio-toilets by 2018 as Indian Railways advances the target for 100 percent installation

NEW DELHI: The Ministry of Railways has advanced the target for 100 percent completion of installing Bio-toilets in coaches to December 2018.

The decision was announced at event titled, “Indian Transport Sector: Marching towards Sustainable Mobility” at Conference of Parties (COP-23), Indian Pavilion at Bonn, Germany on Tuesday.

Ravindra Gupta, Member (Rolling Stock), Ministry of Railways, who is on official tour to Germany, presented the quintessential role of Indian Railways in promoting sustainable mobility.

Gupta also emphasized particularly on the innovative steps taken by Indian Railways by way of bio-toilets for having an open discharge free in line with mission of “Swachh Bharat” and an Open Defecation Free (ODF) Prime Minister Narendra Modi.

Two sessions were organized as a part of this side event. The first session highlighted efforts of Indian Railways towards a low carbon pathway and the second was dedicated to overall sustainable mobility initiatives in Indian transport sector.

The event was attended by nearly 50 national and international participants including eminent speakers, policy makers, industry representatives.

The event started with an Audio-Visual film on Indian Railways showcasing key low carbon transport initiatives being taken by Indian Railways such as Electrification, Energy Efficiency initiatives, renewable energy deployment etc.

The session was organised in partnership with the Council on Energy, Environment and Water (CEEW) and The Energy and Resources Institute (TERI), as knowledge partners, FICCI as industry partner, and RITES as technical partner.

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MMRDA to hold contest to finalise design of Integrated Ticketing System cards

Meanwhile, the MMRDA is still awaiting a written confirmation from the Railways regarding their integration in the single ticketing system.

MUMBAI: The Mumbai Metropolitan Region Development Authority (MMRDA) plans to organise a competition to finalise the design of the card for the proposed Integrated Ticketing System (ITS). With ITS, all transportation corridors within the city will be integrated and commuters can use a single smart card- based ticket to travel in all modes of transport, including suburban railway system, Brihanmumbai Electric Supply and Transport (BEST) buses, the monorail and the existing and upcoming metro corridors.

“We will soon come up with a request to the public for the design of the card with regard to the logo, name and other details. The competition will be open to everybody,” said Sanjay Khandare, Additional Metropolitan Commissioner, MMRDA.

“We will soon come up with a request to the public for the design of the card with regard to the logo, name and other details. The competition will be open to everybody,” said Sanjay Khandare, Additional Metropolitan Commissioner, MMRDA.

The Consultants, PricewaterhouseCoopers (PwC), have prepared the Detailed Project Report (DPR) and MMRDA now proposes to invite bids for the vendor.  “The DPR for the project is almost finalised and the steering committee has approved it. We should be inviting bids for the vendors in December,” added Khandare.

While Mumbai is expected to be the first city in the country to experience integrated transport, it proposes to integrate it with the National Common Mobility Card in the future. Meanwhile, the MMRDA is still awaiting a written confirmation from the Railways regarding their integration in the single ticketing system.

“The Railways have appointed Mumbai Rail Vikas Corporation (MRVC) as the nodal agency for the integration. While they are on board we have not received in writing that they are going to be a part of it. However, that will happen in the due course of time,” he said.

According to MMRDA officials, PwC will continue to help them through the bidding process to finalise a vendor, which is likely to take another eight months. MMRDA had earlier launched a competition for coming up with design ideas for the makeover of the Maharashtra Nature Park in Mahim and more recently for designing the stations of the Dahisar East-Andheri East Metro 7 corridor.

 

Indian Railways’ Freight Loading up 5% in April-Aug 2017

Coal accounts for 48% of the Railways traffic and 44% of its earnings profile. The demand for rakes from the domestic coal sector is way below the projected targets. However Rail freight, container volumes indicate significant rebound in trade in August: reports PhillipCapital India

KOLKATA: The Railways has seen nearly 5 per cent year-on-year increase in freight loading for the first five months of this fiscal (April to August) riding on growing volumes of cement, steel and iron ore traffic.

Steel cargo increased by 22.27 per cent to 22.62 million tonnes (mt) during April-August 2017 over the same period last year.

Iron ore loading saw a near 13 per cent y-o-y increase to 59.23 mt, while cement cargo grew by 12.60 per cent to 47.53 mt. Loading of foodgrains and containers has also gone up. The improved showing, however, came despite a 0.3 per cent drop in coal cargo to 215.86 mt, owing to reduced imports.

No growth in coal

Coal accounts for 48 per cent of the Railways traffic and 44 per cent of its earnings profile. According to Bajwa, while the loading of imported coal dropped, domestic coal loading increased. The demand for rakes from the domestic coal sector, however, is way below the projected targets. As against 238 rakes a day, Coal India Ltd is loading only 214 rakes a day, he said. “We hope the coal loading numbers will improve and we will be able to achieve the set target of 555 million tonnes this fiscal,” Bajwa told BusinessLine on the sidelines of the ‘mjunction’ organised coal markets conference. Fertiliser was the other major category that saw around four per cent decline in traffic, during this period, to 20.29 mt due to “less imports.”

The Railways invests nearly ₹131,000 crore to ramp up rolling stock (wagons), expanding track capacity through line doubling and improving the signalling system. According to Bajwa, by the end of 2018-19, the rolling stock (wagon) availability will increase by 10 per cent.

Container volumes at major ports increased 8.4% in August over a year ago, indicating a significant recovery in trade

Container volumes at major ports (in terms of 20-foot equivalent units) increased 8.4% in August over a year ago, indicating a significant recovery in trade. Due to the initial disruption caused by the introduction of the goods and services tax (GST), container traffic growth had slowed to around 2-5% in the earlier two months. Encouragingly, volumes at Jawaharlal Nehru Port Trust (JNPT), India’s largest container port, remained strong, clocking a growth of 9.1%, data compiled by PhillipCapital (India) Pvt. Ltd shows.

The Indian Railways freight traffic data also indicates a rebound in trade, though it is helped by a favourable base. Traffic in terms of originating tonnes expanded 7.7% last month, the fastest growth so far this fiscal year. The export-import (Exim) container traffic in terms of tonnage is up 19.5%. Domestic container traffic is up 16%, which is a positive surprise.

An analyst with a domestic broking firm says the data indicates continued market share gains by the railways. The recent rise in diesel prices may have helped tilt the cost curve in favour of the railways.

Nevertheless, these numbers should bode well for the national carrier and container train operators. Traffic not only gained momentum in August but growth so far this fiscal is also better than the year-ago period. Compared to 4.3% growth a year ago, container volume at major ports is up 6.4% so far this fiscal. Similarly, total rail freight volume is up 4.9% so far this fiscal, compared to a 1.4% drop in the year ago. Growth in container traffic on the Indian Railways is also significantly better than for the year-ago period.

World Bank asks Railways to paint Trains yellow, ensure high-visibility clothing for employees

NEW DELHI: Paint the trains yellow, have a fire extinguisher on every train, ensure high-visibility clothing for employees and provide four-hour weekly maintenance blocks on all main lines, these are some of the suggestions a World Bank report has made to the railways to ensure safety.

The report, titled ‘Strengthening Safety on Indian Railways’ was submitted to the railways earlier this week.

The report suggests that as an immediate goal, the railways should install “ditch lights” — safety feature in the front of the train to make them more visible — on trains and paint them bright yellow to improve visibility, especially during twilight hours.

It also asks the railways to add side markings to equipment to prevent level-crossing collisions.

“Take fire prevention measures and add fire extinguishers in every train. Choose high-visibility clothing for employees that can be worn all year round and ensure that it is worn at all times. Ensure that footwear and helmets chosen by employees with their allowance is appropriate for their activities,” the report said.

The report has also recommended that level crossings and paths should be painted with a cross-hatched pattern to highlight the dangers of being in the area.

In April, railway minister Suresh Prabhu had approached the World Bank for a study on the issue of safety. He had also consulted various international agencies for suggesting safety measures keeping in view the increasing load on railway infrastructure and subsequent safety issues.

The report has listed a slew of technical actions that the railways can consider over the next two years.

“Training the current investigators in the root-cause analysis of accidents, periodical review of timetables such that a maintenance block of four hours is provided weekly on all main lines, review safety performance in terminal operations with the intent to identify prevailing risks,” the report said.

It also asked the railways to establish an emergency response plan to address derailments, fires, or any other eventuality.

The report has also suggested three broad parameters to improve safety by following international standards.

It has asked the railways to create an independent rail safety regulator, to strengthen the powers of Commissioner of Railway Safety and to form a safety management system under the chairman of the Railway Board.

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New Metro Rail policy stresses on States to improve Viability: ICRA Report

The report elaborated that the viability can be improved by promoting transit-oriented development (TOD) and allying it with real estate development, improving last-mile connectivity as well as attracting private investments.

The new metro rail policy empowers states, by putting the onus on them to improve project viability by stressing on economic viability and private participation, according to a recent ICRA report.

The report elaborated that the viability can be improved by promoting transit-oriented development (TOD) and allying it with real estate development, improving last-mile connectivity as well as attracting private investments.

“The new metro rail policy will increase the state government’s role and responsibility in developing the new metro projects,” K Ravichandran, Senior Vice-President and Group-Head, Corporate Ratings, ICRA, said in a statement.

The policy provides for rigorous assessment of new metro proposals, including alternate transit mode analysis to ensure that the least-cost and most-efficient mass transit mode is selected for public transport, the report pointed out.

Further, it also proposes an independent third-party assessment of proposals by government identified agencies.

“However, the policy’s increased emphasis on PPP model for metro development is expected to face challenges, given the low ridership witnessed in some of the operational metro projects and subdued interest of the private sector in taking up PPP projects,” Ravichandran said.

The PPP in the metro rail sector has so far been limited to only six such projects, one of which (Mumbai Metro Ph-2) was terminated before the start while another one (the Delhi Airport Line) was terminated after it became operational.

Currently, there are three operational PPP-based Metro projects (one in Mumbai, and two in Gurugram) while one project is under implementation (Hyderabad Metro).

The new policy plans to empower states to regulate and set up a Fare-Fixation Authority as well as promoting other non-fare revenues such as advertisements, lease of space, it noted.

Also there are provisions to raise resources using innovative mechanisms like ‘Betterment Levy’ on nearby assets, issuance of corporate bonds and improve last-mile connectivity for a catchment area of nearly five km, to promote metro ridership.

Firms vie to give Pune Railway station a face-lift on Swiss Challenge Model

Pune station is among the 23 railway stations, which are scheduled to be revamped along the lines of a ‘Swiss Challenge’ model. The ‘Swiss Challenge’ model of bidding is different than the conventional process. It allows the entity, which submitted the unsolicited bid itself, to match or better the best bid that comes out of the Swiss process.

PUNE: Six national and foreign infrastructure firms are vying to get the contract for redevelopment of the Pune railway station under the ‘Swiss Challenge’ model, the decision on which will be declared in a few months, said officials. Several bidders have approached the officials in the Pune Division and the Railway Board for the contract. Earnst and Young, which is appointed as an advisory firm, is in touch with the prospective bidders.

Pune station is among the 23 railway stations, which are scheduled to be revamped along the lines of a ‘Swiss Challenge’ model. The second phase of a mega modernisation programme is slated to kick off later this month. Passengers may soon get to enjoy “airport-like facilities”, said an official.

The Railway Board has identified 15 key parametres, including separate arrival and departure terminals, easy connectivity with local modes of transportation, such as bus or Metro, and accessibility from both sides of the city. Facilities such as food courts, retail outlets and medical facilities will also be made available.

“The project is getting good response from the infrastructure firms. As many as six companies have approahed us, in Pune and Delhi. Most of the work is being handled from Delhi. We have a liasoning officer in Pune too,” said a senior official in Pune Division.

The ‘Swiss Challenge’ model of bidding is different than the conventional process. It allows the entity, which submitted the unsolicited bid itself, to match or better the best bid that comes out of the Swiss process.

“Under the project, real estate development of land and air space belonging to the railways will be done. The private partner can exploit the space for commercial purposes. Redevelopment is on ‘as is where is’, through open invitation from interested parties with their designs and ideas,” said officials.

Officials added that the estimated cost of redevelopment of Pune railway station is 200 crore. The other stations scheduled for remodelling include Thane, Lokmanya Tilak Terminus, Mumbai Central, Bandra and Borivali.

Enterprising Students from BITS-Pilani set foot on building a Hyperloop that travels at 1200 Kmph

Even as Hyperloop One is liaising with the Indian government to bring the Hyperloop to India, an Indian student team is preparing to demonstrate its own Hyperloop technology at the SpaceX headquarters in California. The team is supported and mentored by organisations like Invest India, RITES, NITI Aayog and Indian Railways,after collaboration with IIMs, IITs and ISB on the feasibility of the project.

PILANI: Hyperloop India, a team run by BITS Pilani students, is now a finalist in Elon Musk’s Hyperloop challenge. Over a thousand student teams had participated in the competition, and 24 of the best designs from across the world were selected. These 24 teams will travel to California, pods in tow, where they will vie to be the fastest to travel the 1 mile distance on a specially constructed track.

Presently, India is making way for Bullet trains to move parallel with the first and second world countries but a group of enterprising students from BITS Pilani have already set foot much farther than this. Currently, they are working on building a hyperloop, which is much, much faster that bullet trains.

It’s likely that the pods will go very fast — Hyperloop technology can transport people at over 1000 kms per hour. It was first proposed by Elon Musk in 2013, who’d then claimed it would become the fifth mode of transport after cars, planes, trains and ships. Hyperloop systems consist of pressurized pods, which travel through steel vacuum tubes using a linear electric motor.

While no working prototypes exist, several private companies are engaged in developing their own solutions. Among the most prominent is Hyperloop One, which had carried out a public test of a rudimentary pod last year, and had declared it to be successful. Hyperloop One had then sent executives over to India, and had released a list of routes where it could build its tubes with some tantalizing timings — a Hyperloop One pod could, for instance, transport people from Mumbai to Delhi in just over an hour.

That’s what appears to have motivated the Hyperloop India team, which describes India’s transportation problem in delightfully nerdy terms. “India’s transport problem is an obvious “sysadmin” issue – A legacy system from the colonial rule running the world’s fastest growing economy,” the team says. They initially found the Hyperloop solution crazy, but felt it deserved a chance. “It was a pity that no one here was trying to work on it! So we decided to at least start trying to do something about it.”

They grouped together into a team of 60 in 2015, and started working on their design. Hyperloop India works out of 5000 square foot space under the Halasuru metro station in Bangalore. Their pod is called the OrcaPod, and promises to be safe, feasible, and hopefully for the SpaceX competition, fast. People have begun to take notice of their efforts — Ripple technologies, an engineering services provider is helping the team create and manufacture its components, and corporates such as Bangalore Metro, and BEML India have lent their support. The team is also running a crowdfunding campaign to help raise money to manufacture the pod — in order to manufacture the pod, the team needs to raise around 20 lakh over the next few weeks.

For instance, a bullet train would take about two hours to cover the distance between Mumbai and Ahmedabad, rushing at the speed of 320-350 km per hour maximum. The hyperloop reduces that time to merely 40 minutes, advancing at the anomalous speed of 1,200 km per hour. The idea sure sounds thrilling and quite unbelievable, and yet, is being worked upon by the young minds of BITS Pilani.

They take their inspiration from the ground-breaking “Hyperloop” travel idea of billionaire entrepreneur Elon Musk, and are about to complete the final stage of building “Hyperloop India’s” single-compartment capsule or pod. They have planned to present and test the same in late August at the Musk-owned SpaceX headquarters in Hawthorne, California, in the final round of a global contest that was initiated in 2015.

A BE final year student at BITS Pilani and a member of what is being called Team Hyperloop, Prithvi Shankar says:

Hyperloop is tube travel wherein you have a vehicle that is magnetically levitated and propelled inside a vacuum tube. The technology that is used for the propulsion and braking systems can vary.

The bright, young mind mentioned that the team is using a “scalability first” approach, making the design more flexible for the transportation of cargo as well as passengers. According to their “feasibility assessment”, the concept works in theory and will cost only 60 per cent of the total cost of the Mumbai-Ahmedabad Bullet train, if adopted. He said:

If hyperloop were to replace the high-speed rail that is currently being proposed… the entire infrastructure cost will be 40 per cent less, plus the maintenance costs will be much less. It will also require very little land acquisition.

Not only Bullet trains, but Hyperloop will be faster than the Maglev (Magnetic Levitation) trains as well, which themselves touch 650 km per hour and are currently operational in Japan and China.

Despite the fact that both are magnetically levitated, the reason why Hyperloop is going to have a upper hand over Maglev is that it will run inside a vacuum tube, inclining that it will avoid all air resistance and hence, will employ a different propulsion method. For the Hyperloop, passive permanent magnets are used, instead of the alternative electromagnets that require a constant electricity supply.

BITS’ Team Hyperloop India is using the material which differs from what the other 23 teams in the contest are using. Shankar says, Hyperloop India is going to use aircraft-grade aluminium, “which is four-times cheaper than carbon-fibre”. The latter is the one which the other teams are using to make their capsules.

The model will also stand out, he continues, given the capsule will be having an aerodynamic structure. He said:

Other teams are not dwelling on this, but we have kept our focus on an aerodynamic structure for the pod since at such a high speed of 1,200 km/hour, although there’s a very little air to be displaced, aerodynamic drag can become a powerful factor.

The team comprises of three members, two of which are student — Shankar and Shibhesh, who are workinh under Professor M.S. Das Gupta of BITS Pilani. This is the only team representing India and the second representing Asia, which will be going to California to present their model.

Back in 2015, in in response to the SpaceX design contest for which the firm built a one-mile (1.6 km) track on its premises and invited teams from all over the world to design hyperloop vehicles that could travel on the track, the tech-minds came together and rose as a team.

With 3 from India, a total of 216 teams coming in from all around the planet, Team Hyperloop India is now standing among the 24 finalists.

Now being supported and mentored by organisations like Invest India, RITES, NITI Aayog and Indian Railways, the team has already collaborated with IIMs, IITs and the Indian School of Business on the feasibility of the project.

Indian Railways to soon introduce speedy Wi-Fi Access for passengers onboard the train

In Aug 2016, RDSO approved C-DOT gears for Wi-Fi services. Soon, you’ll be able to access Facebook, WhatsApp, Twitter and other apps onboard your train. Currently, Wi-Fi services access across the trains and Railway stations is being provided by the RailTel Corporation of India Ltd.

NEW DELHI: After the successful stint of installing Wi-Fi across 125 stations, Indian Railways is now looking forward to providing Wi-Fi internet access for all its onboard passengers for the entire duration of their train journeys, says a report in The Financial Express.

Indian Railways has already been giving Internet services on its premier trains such as the Tejas, Gatimaan, Delhi-Howrah Rajdhani Express and other luxury trains for quite some time now.

The internet services provided until have been through a satellite which makes them very expensive.

Under the new system, the Wi-Fi devices will be installed on a track-side equipment basis at periodic intervals for uninterrupted Internet access.

Research for the project is being carried out by IIT Chennai and Centre for Development of Telematics (C-DOT).

IIT has already developed a concept and C-DOT is working on an existing equipment which requires some modifications before it can be implemented for the trains. Indian Railways is also on the lookout for partners for the project.

As per a statement from an official, a pilot project will be started in the Chennai-Bangalore line soon.

The development comes at a time when Indian Railways is trying hard to get an image makeover and boost its present state of services especially in light of recent accusations made by the CAG and its efforts to match up to the aviation sector to which it is fast losing passengers.

Currently, Wi-Fi access across trains is being provided by the RailTel Corporation of India in association with Google.

The Indian Railways has also started providing onboard entertainment in selected trains and it also launched RailCloud – a virtual server with an inbuilt security system that will enable faster connectivity at a reduced cost.

Wi-Fi technology of state-run Centre for Development of Telematics (CDOT) has been approved by Indian Railways. Most of the equipment installed in Indian telecom network were imported earlier. Approval of C-DoT Wi-Fi equipment will help deployment of indigenously made gears.  The company is in the advanced stages of developing of 5G technology.

IPRCL to build Indore-Manmad Rail line to ease Container Shipment to JNPT: says Nitin Gadkari

MUMBAI: Indian Port Rail Corporation Ltd (IPRCL), which is executing projects worth Rs 1 lakh crore, will build Indore-Manmad rail line for shipments of containers to JNPT, Union Minister Nitin Gadkari said today.

IPRCL is a first-of-its-kind Joint Venture Company (JVC), between the Major Ports under the Ministry of Shipping, and Rail Vikas Nigam Limited (RVNL).

“From Indore and Dewas 47,000 containers go to JNPT (Jawaharlal Nehru Port Trust). They go via Ahmedabad and Delhi. It takes eight days for containers to reach JNPT. We (IPRCL) are constructing a railway line between Indore and Manmad which can carry shipments in just 24 hours,” Shipping, Road Trnasport and Highways Minsiter Gadkari told reporters on the sidelines of India PPP Summit organised by FICCI.

He said the detailed project report for about 339 km-long project is ready which is aimed at cutting down Indore-Mumbai distance by 200 km and would offer a corridor for despatching export containers from Indore region directly to JNPT. The minister said that 50 per cent of the about Rs 4,000 crore project would be funded by the Railways while the remaining will be offered by JNPT.

“Earlier, Railway Minister has said that 50 per cent of the cost will be contributed by the states and the rest 50 per cent by the Railways. Madhya Pradesh and Maharashtra had expressed their inability to do so. I said JNPT will provide 50 per cent and the rest 50 per cent will be provided by the Railways,” Gadkari said.

The discussions on the project are on and the land will be provided free of cost by Madhya Pradesh and Maharashtra governments, which will be converted into equity. State governments have also agreed to exempt taxes, he said. Likewise, the minister said that a Rs 1,000 crore rail line is bieng built to carry coal from Talcher to Paradip where Coal India plans to augment its output from the present 60 MT to 300 MT. “Coal can easily be transported to Kandla and Mumbai from Paradip after the project,” he said.

A FICCI-EY study titled, ‘Revival of PPP momentum in the transport sector’, highlighted the need to resolve multiple issues dampening the private sector interest and slowing the rate of private investment in the sector. It calls for key interventions to remove the roadblocks to PPP and accelerate the implementation of PPP projects. These interventions would include policy actions, regulatory changes and push the reforms agenda, which will create conducive environment for bringing investments into the sector.

The study was released today by Nitin Gadkari, Minister for Road Transport, Highways and Shipping, Government of India; Amitabh Kant, Chief Executive Officer, NITI Aayog; Junaid Kamal Ahmad, India Country Director, South Asia, The World Bank, and other dignitaries at the inaugural session of the India PPP Summit, orgainsed by FICCI in association with the International Chamber of Commerce (ICC) India.

The main recommendations of the study include strengthening of lending institutions, greater participation of insurance and pension funds, establishment of Infrastructure PPP Project Review Committee (IPRC) and the Infrastructure PPP Adjudicatory Tribunal (IPAT), setting up of 3P India as proposed in the Union Budget for 2014-15, mechanism to keep a check on aggressive bidding , need for independent regulators, passing and enactment of pending bills, strong emphasis on performance-based contracts, better preparation of DPR and revisiting the Viability Gap Funding (VGF) Scheme.

NITI Aayog approves Rs.18000 Crore investment for Railways

NEW DELHI: NITI Aayog on Friday approved investments worth Rs. 18,000 crore for high-speed rail projects for major routes of Delhi-Mumbai and Delhi-Kolkata, Union Minister for Railways Suresh Prabhu said at an ASSOCHAM event here today.

“We are working on Gatiman Express which is India?s fastest train at 180 km per hour and trying for Mumbai-Delhi and Delhi-Kolkata which are major routes with a speed of maximum 200 km per hour (kmph) and that will be an investment of Rs. 18,000 crore which has already been approved by the NITI Aayog,” said Prabhu while inaugurating an ASSOCHAM International Conference RAILTECH 2017.

“When we proposed it, they were apprehensive but now everybody realises importance of it as it is a least-cost option, so we are trying to do that, you can imagine the trains can go at that speed from Delhi to Mumbai and how much travel time will be reduced,” added Prabhu.

He also said that Railways Ministry is working with many countries to increase the speed of operations, including France.

“There are a lot of studies which are going on and they are in a very advanced stage, so we will start implementing that in the next few months” time,? added the minister.

He added that the Government is working towards introducing cutting-edge technology of future in all aspects of railways with it not only being imported but being co-developed in India.

“We already had about six to eight months ago, a programme in which we called all the major technology developers who had not yet fully developed, commercialized the technology which can take the speed of railways to more than 600 kmph and we are already working with them, companies like Hyperloop,” added Prabhu.

Talking about the use of high-end technology on safety front, he said that self-propelled detection of tracks together with use of ultrasonic machines and geo-spatial technology to alert about unmanned railway crossings are underway.

On laying of railway tracks, he said that automatic track laying machines which are already being used on Dedicated Freight Corridor will now be tried all over the country.

“This has already resulted in increasing the speed of putting the track which was only three kms. per day to almost eight kms. per day and the target is to take it to 20 kms per day in the next three years and definitely we are on track for doing that,” added Prabhu.

He said considering that capital expenditure needed for optimal technology has gone from Rs. 30,000 crore a year to almost Rs. 2,75,000 crore in the last 2.5 years shows the commitment of the Government.

On the rolling stock, he said that two major locomotives are already in use with one from French transport giant Alstom. “It is going to bring in the best cutting edge technology, environment friendly, speed will be good, least fuel consumption and that will available in the next month?s time and that is going to be manufactured in India.”

He said that another locomotive factory would be set up in West Bengal, “We are yet to finalise the bid, but it will already be happening. That again will begin the best technology in fact, all the top global players are vying for it.”

Highlighting that the Government is taking all these steps in a very transparent manner, the Union Minister said that companies like Siemens have made a consortium in this regard. “So you can imagine how serious they are because otherwise they would have come on their own.”

Prabhu also informed that Railway Ministry has started working on revamping, refurbishing and retrofitting of 40,000 outdated coaches.

?We have already stopped manufacturing non-LHB coaches from April 1, next year and all the LHB coaches will be manufactured, so you can imagine the technological up-gradation that is happening at all levels,? he said.

He said that Railway Ministry has also completely revamped the ticket-booking mobile application with many services being made available on one single application. “This is going to bring in a completely different experience for the traveller because he can book it completely on his palm literally, not only booking but anything to do with railways.”

Talking about the recently held huge roundtable conference on technology, he said that Railway Ministry was engaging with all the top global players that had participated in the same.

?I think we have already taken very serious steps, to modernise and optimise the capacity of railway operations and the biggest other technology tool that we will be using and we have already started work on is rail cloud,? said Prabhu.

He said that Railway Ministry has also started working on enterprise resource planning (ERP) which has the potential to save up to Rs. 70,000 crore.

?We are also using technology for each and every aspect of railways, including managerial practices which includes our internal processes to ensure that efficiency is allowed and in fact we will try to plug every possible area where there is a leakage, hoodwinking possible and the system will be made foolproof,? said the Union Railway Minister.

Apple to collaborate with Indian Railways to increase train speeds over 600 km per hour

NEW DELHI: Eyeing trains speeds of 600 km per hour, the government is working with global technology firms like Apple to help take Indian railways to the next level, Union minister Suresh Prabhu said on Friday. Speaking at a conference attendended by senior rail officials, Prabhu said that as part of modernisation and maintenance of railways, the ministry has lauched several initiatives over the past three years like RailCloud Server and Rail Saarthi App and is working on a enterprise resource planning (ERP) solution.

The railway minister also said the government’s premier think tank NITI Aayog had approved the ministry’s Rs.18,000 crore proposal to increase speeds of the Gatiman Express on the two busiest corridors, Delhi-Mumbai and Delhi-Kolkata.

With this approval, the speed of the Gatiman Express would increase to 200 km per hour, the minister said at an event organised by industry chamber ASSOCHAM.

“You can yourself imagine how much travelling time this will save.” Sharing plans for the future, Prabhu said the government had six-eight months ago called major technology developers working on increasing train speeds to more than 600 km per hour.

“We are already working with companies like Apple… technology will not only be imported in India but will be co- developed in India,” Prabhu said.

Safety was also an important concern and Indian railways was planning to use self-propelled coaches that can detect rail fractures through ultrasonic technology, the minister added.

Ensuring cyber security in day to day operations is one of the priorities for railways which is moving in a big way towards technology driven operations, Railway Minister Suresh Prabhu said today.

“We are working on a complete transformation of the railways through investment of huge amounts of money and transformation of each and every aspect of operations to make them better. We are using high-end technology for maintenance and detecting defects in tracks through one application,” said Prabhu

“So if we are doing all this and using the cyber space for digital transactions, obviously, the vulnerability of that transaction becomes very critical.

“When we do everything manually, the challenge is manual error and if we are shifting from manual to technology oriented operations, then the flaws in technology or someone who can potentially hoodwink it is as high and sometimes even dangerous. So cyber security is one of the top priorities,” the minister added.

The meet on ensuring cyber security in Indian Railways, attended by Chairman, Railway Board, A K Mittal and other railway board members and senior officials, saw discussions on cyber threats, security incidents and advanced solutions.

Computerisation in railways started about three decades ago and major activities like ticketing, freight operations, train operations and asset management now rely heavily on IT systems.

Railways launched RailCloud this month, a virtual server with an inbuilt security system that will enable faster connectivity at a reduced cost.

RailCloud technology enables maximising the usage of available server and storage resulting in accommodation of bigger data and more applications within same server space.

Till now all IT applications had separate servers which increased the cost of operations and purchases.

Cyber Security has now been identified as the focus area by the railways. Auditing of IT Systems by Standardisation Testing and Quality Certification (STQC) and close coordination with Indian Computer Emergency Response Team (CERT-In) are some of the steps taken by Indian railways.

World Bank to help Indian Railways transform Digitally

NEW DELHI: The Indian Railways has collaborated with the World Bank to help it transform completely in terms of digitisation, technology development and investment and planning.

The Bank will help in the integration of architecture and database management for Railways.

The World Bank will also help in establishing a Railway University and the Rail Tariff Authority.

Indian Railways, 164-year-old railroad network which is the world’s fourth longest will overhaul its entire operations in the next two-to-three years.

“We needed this arrangement to build our capacity and deliver projects on a mission mode. World Bank’s expertise would be a great gain,” a rail ministry official said.

The Railways has decided to invest  Rs 5 lakh crore in the next four years.This year, it is spending  Rs 1.31 lakh crore to augment capacity.

The World Bank has also proposed to set up an organisation for creating detailed forecasting models, traffic optimisation and planning.

“Further, an infrastructure plan for the next 10-15 years, after a detailed analysis on freight and passenger growth expected in India, is also envisaged to be created. The bank would be drawing that up as well,” the official said.

World Bank to draw up a Blueprint for Indian Railways’ Rs.5 lakh Crore makeover

NEW DELHI: The World Bank will help draw up a granular makeover blueprint for the Indian Railways, which is investing Rs 5 lakh crore to transform itself from a colonial-era mass transporter into a strategic platform underpinning growth in Asia’s third-biggest economy.

The multilateral lending agency would partner the 164-year-old railroad network, the world’s fourth longest, to help the state transporter with investment and planning, digitisation and technology development, besides establishing a Railway University and the Rail Tariff Authority.

The bank, which has earlier worked with the Railways for financing the Eastern Dedicated Freight Corridor Project, will provide advisory services and programme management consultancy for this transformation exercise for 2-3 years.

“We needed this arrangement to build our capacity and deliver projects on a mission mode. World Bank’s expertise would be a great gain,” a top rail ministry official said.

Rail minister Suresh Prabhu has drawn up an ambitious plan to transform Railways with an investment of Rs 5 lakh crore in the next four years. For this year, the Railways would spend Rs 1.31 lakh crore to augment capacity.

On the planning front, the World Bank has proposed to set up an organisation for creating detailed forecasting models, traffic optimization and planning.

“Further, an infrastructure plan for the next 10-15 years, after a detailed analysis on freight and passenger growth expected in India, is also envisaged to be created. The bank would be drawing that up as well,” the official said.

In line with Prime Minister Narendra Modi’s Digital India programme, the Railways wants to roll out a ‘digital enterprise’ for which the bank will help integrate architecture and database management across its IT applications.

It would be sensible for Railways to tap multilateral funding. Resources should be leveraged from National Investment and Infrastructure Fund. The way ahead is to plan modular projects, which can generate cash reasonably quickly. IR need to keep a close tab on borrowings, given that operating ratio is in high nineties (over 90% of revenue earmarked for routine expenses). So, resource allocation and prioritising expenditure is important. Hence the rationale to access global expertise for programme management and attendant advisory services. It would optimise resource usage.

Real Estate to gain up to Rs.90,000 Crore from Metro Rail projects: ICRA

Overall expenses in expanding Metro Rail projects in various states stands at Rs 2.5 lakh crore

MUMBAI: The construction sector in the country is expected to witness a boost in its order book due to the strong traction seen in the Metro rail sector, according to rating agency ICRA.

The rating agency expects orders from the Metro rail sector to help boost the order book of the construction industry by Rs.75,000 to Rs 90,000 crore over the next three to five years. “The overall cost of expansion of operational and under-implementation Metro projects is over Rs 2.5 lakh crore. This would support the order books of construction contractors.Further, Metro Rail projects (MRP) worth another Rs 2 lakh crore are at various stages of approval and are likely to come up for bidding within the next five years,” ICRA said in its note.

“Roads and urban infrastructure, including Metro Rails are two key segments that have witnessed robust order inflows for the construction companies. Further, with a sizeable pipeline of projects in these segments, the sector is expected to have sufficient order inflows and companies with a strong track record and a healthy balance sheet are expected to exhibit strong growth, going forward, “said K Ravichandran, Senior Vice-President and Group-Head, Corporate Ratings, ICRA.

Among the companies that are likely to benefit for the fresh flow of orders are ITD Cementation, L&T, Afcons, NCC, and IL&FS Group. All these firms have an exposure to the Metro rail sector.

According to the ratings agency, development of the Metro Rail is being planned in over 30 Indian cities. Currently, the Metro rail network (MRN) is operational or partly operational in nine cities. Another five cities have under-implementation Metro projects. In addition to the extension of the MRN in these cities, a new Metro rail network is to be developed in another 15-20 cities.

ICRA also pointed out that private public partnerships (PPPs) in the Metro rail sector has been limited so far. “The PPP participation in Metro rail projects has been limited so far. In order to encourage PPPs, adequate risk allocation would be required in the form of concession agreements, availability of the low-cost debt funding, and the presence of a robust dispute resolution mechanism,” said Shubham Jain, Vice-President and Sector-Head, Corporate Ratings, ICRA.

ICRA Limited (ICRA) is an Indian independent and professional investment information and credit rating agency. It was established in 1991, and was originally named Investment Information and Credit Rating Agency of India Limited (IICRA India). It was a joint-venture between Moody’s and various Indian commercial banks and financial services companies. The company changed its name to ICRA Limited, and went public on 13 April 2007, with a listing on the Bombay Stock Exchange and the National Stock Exchange.

Doubling, Tripling of 16500 km Railway lines in a few years: Suresh Prabhu

NEW DELHI: To fast-track creation of a robust infrastructure, the government has sanctioned plans for doubling and tripling of 16,500 km of railway tracks in few years as against only 22,000 km in last 70 years, Union Minister Suresh Prabhu said on Thursday.

“We have decided to create an infrastructure at a much faster pace…16,500 km of doubling and tripling will happen in the next few years as opposed to what 22,000 km was sanctioned in 70 years,” Railways Minister Suresh Prabhu said on the sidelines of a ASSOCHAM event here yesterday.

Prabhu said Railways is investing in infrastructure to create seamless movement of traffic so that GST becomes a gamechanger wherein goods are moved without hassle.

“Only 42 per cent of electrification has been made so far which will double in next five years,” the minister said addressing the conference on ‘India – on the Cusp of a Logistics Revolution.’

He said, “We are already creating about 100 private freight terminals with private participation so that more and more traffic can come to the railways”.

The Railways plans to save about Rs 41,000 crore in energy bills of which it has already saved about 10 per cent, he said.

“So, all of this will result in creating a good logistic backbone for India which will help it do much better business as logistics is key to success of industrialisation,” he said.

On low consumer price inflation, Prabhu said it is the result of sound fiscal monetary policies in India.

“Our prime minister already said that people at large are suffering because of inflation being very high and the growth rate being low. So, it was double whammy. We actually reversed it, inflation is low and growth is high means the common people don’t have to spend too much money on their daily necessities and they will have more savings,” he said.

Railway to diversify its Freight basket, eyeing for smaller Cargo

PANAJI: With the policy to encourage private freight terminals in place, the union railway ministry is now eyeing for smaller cargo which will help the ministry diversify its freight basket.

“Railways traditionally have been doing business in bulk commodities that too in ten major commodities like ore, cement and others,” Prabhu said addressing the third conference on logistic organised by the Confederation of Indian Industries (CII).

The minister further said, “What is important now is that over a period, we will have to diversify the freight basket and to do that, we need smaller quantities of freight.”

Prabhu suggested that the public-private partnership initiatives can go a long way in achieving the aim of accommodating smaller cargo.

“Some players can bring in cargo to the railway point, and there are private freight terminals which can keep them and then it can go on the rail,” Prabhu said.

He stated that the vision document to make Indian Railways the best in the world by 2030 was ready, and that ground work had started. The minister said that the railways are working on a structured plan which will encourage multi-model transportation process.

“The multi-model transportation will help to connect ports and also contribute to bringing in even urban transportation into reality,” he said mentioning about the announcement to promote private freight terminals. He said adding his ministry is working with other ministries to make all these things a reality.

Referring to the new GST regime, Prabhu said, “many things have happened in India, and this is the right time to take those things ahead.”   “Five days ago, we created a unified market by bringing in a path-breaking legislation. Now we can move goods from one place to another without any hindrance,” he said.

Prabhu said the railway ministry was working with “All other colleague ministries to make multi-modal transportation model a reality.”

Prabhu also said that this is right time to think about logistics as a new destination for investment.

Whether FinMin agree to bear Social Obligation Costs of Indian Railways?

National Institute of Public Finance and Policy (NIPFP) computing the Indian Railways’s social obligation costs will help in streamlining the finances borne by Railways; says experts.

NEW DELHI: In what will help in streamlining Indian Railways’ finance, the government plans to task the National Institute of Public Finance and Policy (NIPFP) to find out the social obligation costs borne by the national transporter, several people aware of the development said.

The issue of social obligation costs due to concessions given to senior citizens, defence personnel, sports-persons and cancer patients among others as well as running non-economical rail routes has been plaguing railways’ finance. The decision by Indian Railways to mandate NIPFP to undertake the study follows the finance ministry’s refusal of the Indian Railways’ social obligation costs claim of around Rs30,000 crore till date citing “inaccurate figures”.

The cash-strapped railways has been requesting the finance ministry to bear its social obligation costs.

“The decision has been taken to empanel NIPFP after finance ministry has refused to accept our calculations of social obligation costs. A memorandum of understanding will be signed with the institute soon,” said a senior railway ministry official requesting anonymity.

NIPFP is a research institute under the finance ministry.

Railway ministry spokesperson Anil Saxena confirmed the development.

This comes in the backdrop of the merger of the railway budget with the Union budget which was presented earlier this year. Also, the National Democratic Alliance government unveiled the largest-ever rail budget of Rs1.31 trillion, an 8.26% increase over the Rs1.21 trillion allocated in 2016-17. Indian Railways, the world’s fourth-largest railway system, has also firmed up a medium-term plan of investing Rs8.5 trillion by 2019-20.

“The railways and finance ministries had several meetings and the railways have apprised them of costs incurred by us on social service account. These include lower passenger and freight fares, special concessions, new lines and branch lines. However, the finance ministry is not accepting the low fare argument stating it was railways’ decision and not a social obligation,” said the first railway ministry official cited above.

Earnings from freight traffic continued to fall, declining by 4.4% to Rs1.04 trillion in 2016-17, reflecting the competition railways is facing from airlines and road transport, a slower-than-expected economic recovery and the declining demand for coal.

The official added that the finance ministry is of the view that passenger concessions are going to people who are travelling in reserved categories.

“Their view (finance ministry) is then how can railways say it is for poor as the concessions are for A1, A2, A3 and all categories. If special concession is considered category wise then it (social obligation costs) amounts to only Rs ,600 crore,” the official said.

Railways, which has been losing out freight traffic to roads, clocked revenue of Rs1.65 trillion in 2016-17, a marginal increase over the Rs1.64 trillion registered in 2015-16 due to non-fare revenue such as right of way charges, reimbursements for strategic lines, advertising, land monetization, catering and parking.

“The railway ministry is not correct with its figures. When the finance ministry asked for the branch lines it was running, the national carrier handed over a 17-year-old list of 90 lines in most of which gauge conversion has taken place. Despite this, they are incurring operational expenses on station master etc., on abandoned narrow and metre gauge lines,” said a senior government official aware of the issue.

The official added that the finance ministry has said that it would accept the railways’ demand provided there was proper computation.

Queries emailed to finance ministry and NIPFP on Friday remained unanswered.

National Council of Applied Economic Research to bring out report on jobs in Railways

NEW DELHI: The National Council of Applied Economic Research will soon bring out a report on employment generation potential in Indian Railways in the backdrop of the huge investments that are planned, said the Union Minister for Railways, Suresh Prabhu.

Delivering the 33rd Nani A Palkhivala Memorial Lecture on the topic ‘Putting India on the Fast Track’, here on Saturday, he said every rupee invested in the railways offers six times more in spinoff benefit.

Citing the massive efforts by the Ministry to strengthen railway infrastructure, he said this was an instance of the government driving economic development by creating an environment for business and entrepreneurship.

Prabhu pointed out that Palkhivala, an eminent jurist and authority on Constitution and taxation laws, was always for individual rights and believed that State should act as a facilitator.

Proposals for the creation of a dedicated freight corridor that will speed up movement of material and free up space for passengers, high speed trains linking major cities, modernising rolling stock and enhancing efficiency are all aimed at creating an enabling environment for business.

Recalling from his personal experience while heading the power sector, he said the power sector had grown only after power reforms and drawing private sector players to invest.

“But that does not mean privatise everything,” he cautioned. There should be a balance with the State focussing on governance, ease of doing business, large infrastructure projects, safety and security and regulation. In the last few decades the government has “ignored core functions and abdicated its responsibility”. That is now being corrected, he said.

Earlier in February, 2016, NCAER conducted a Research Study for Indian Railways, “Factors Impacting Railway Freight Traffic in India” and the document was published in the presence of Railway Minister.

ASSOCHAM says Railways, Roads should be exempted from GST

NEW DELHI: In view of the long gestation period and showing negative returns, industry body ASSOCHAM has suggested that infrastructure and transportation such as road and railway sectors should continue to be exempted under Goods and Services Tax (GST) regime.

In a note submitted to the Finance Ministry, ASSOCHAM has suggested that to avoid accumulation of input tax credit with the contractors, a similar exemption should be granted in GST on direct procurements made by the contractors for use in such projects. Further withdrawal of exemption on existing projects will have a negative impact on business revenues.

The chamber says, alternative options should be provided in GST, such as Zero rating the Contract Value chain, in the event the current Exemptions are withdrawn, so as to protect the Infrastructure Projects from any additional tax burden.

The chamber spokesperson says, presently, highway toll collected from passengers and annuity amounts received from NHAI for construction and maintenance of highways is exempt from Service tax. While service by way of access to a road or a bridge on payment of toll charges has been specifically exempted in GST regime, exemption to similar income received in form of annuity from NHAI has not been provided. Essentially in case of annuity based project NHAI collects Toll charges and share Toll income in form of annuity.

Levy of GST on existing contracts with non-recoverable taxes from NHAI will have significant impact on revenue and therefore exemption should be accorded to annuity income as well.

As per contract with NHAI, concessionaire is required to a share a pre-defined percentage of income from toll collection with NHAI and there is no clarification whether sharing of such exempted income would be subject to GST. Since Toll income is exempt from GST, sharing of such income also should not attract GST.

It may be mentioned that currently the services provided to infrastructure project are exempted from service tax and wherever service tax is levied, works contract abatement is available and in VAT also abatement is available and the combined effective tax rate comes to 10 percent to 12 percent while the rate schedule released by GST council provides for 18 percent GST rate for Works contract services.

ASSOCHAM has strongly recommended that rate of GST should be retained at the current levels on the Goods and Services, on the existing projects in progress as any increase in existing tax cost will adversely impact the project financials, cash flow and margins, due to inability to pass on or recover such increased cost in the entire Contract value chain and GST rate on works contract services should be provided as 12 percent instead of 18 percent.

Similar rate structure has been provided by GST council for Construction of a complex, building, civil structure or a part thereof, intended for sale to a buyer, wholly or partly.

Railways to announce employment notification for filling up of 25,000 posts this fiscal

NEW DELHI: At least 25,000 new employees are set to join the ranks of Indian Railways this financial year. This is at a time when the national transporter is staring at a shortage of over 225,000 employees.

“Nearly 25,000 new staff will be joining the Railways in 2017-18. Tests to recruit 18,252 posts, including assistant station master, inquiry-cum-reservation clerk, traffic and commercial apprentices, goods guards and junior accounts assistant have already been conducted. In addition to this, applications for another 7,000 assistant loco pilots will also be invited soon,” said an official source close to the development.

Soon after this, vacancies for another 13,000 will be open under various categories, including technical supervisors.

In 2016, the Railways grabbed headlines by conducting the world’s largest online examination in which 9.2 million job applications were received for 18,252 vacancies.

“More than 270,000 people out of this were called for written test early this year and we finally short-listed about 18,000 people. These applicants are set to join us in a few months time,” the official mentioned earlier added.

As of December 2016, Railways has a staff strength of more than 1.3 million, while it has 225,823 vacancies in Group ‘C’ and Group ‘D’ categories.

According to data available with Railways, it has 122,911 vacancies in safety categories and a shortage of another 174,64 loco running staff.

This comes at a time when an audit on gazette officers manpower conducted by Deloitte, submitted to Railways suggested that it is neither “under-staffed nor overstaffed” in the officer category. The executive officer strength of Railways is around 18,000. Deloitte was expected to formulate a manpower policy for the gazetted officers of Railways.

“Though people say we have vacancies of over 200,000, a large chunk of it is not needed to be filled up because of advancement of technologies and computerisations of safety mechanism. Filling up of vacancies is a continuous process through various modes of intake,” the official added.

Railways was planning the rationalisation of its manpower over the years and in a decade, it has recommended surrender of close to 140,000 posts, according to sources.

Railway officials say the bulk of the accidents that take place every year is at unmanned level crossings. Indian Railways currently has more than 6,000 unmanned railway crosses across the country now.

In the wake of recent accidents, critics were highlighting the staff strength also as a cause of concern for safety.

Indian Railways extends to more than 67,312-kilometre track, having about 12,600 trains carrying about 23 million passengers a day.

Railways to raise Rs.35000 Crore from World Bank to boost Infrastructure

NEW DELHI: Railways will look for innovative ways, including assistance from the World Bank, for financing its future projects.

“We have to look into how to finance the future of the Railways. We have already raised some but we need more money. Everybody has to contribute towards it,” Railway Minister Suresh Prabhu told.

Aiming at a major push for infrastructure, the Railways will raise Rs 35,000 crore with World Bank assistance to create a separate fund for investment in the rail sector.

Currently various innovative financing models are being undertaken as extra budgetary resources like loan from the LIC, PPP models and joint ventures with state governments for rail development projects.

The Railways has to raise Rs 5,000 crore every year to strengthen safety infrastructure for achieving its zero accident target.

The Modi government has earmarked Rs 8.5 lakh crore for the Railways for 2014-19 keeping the massive expansion plan in rail sector in mind.

Asked about the possibilities of passenger fare hike in the near future, Prabhu said, “Rail Development Authority (RDA) is being created now and it will decide about it. The RDA will have to first recommend for it and then only it will be taken up.”

The Union Cabinet has approved the proposal of constituting the RDA and the government is in the process to appoint a chairman and other members of the authority.

Once the RDA is formed, it is expected to take up the fare issue after taking into consideration various factors such as input cost and market condition.

However, Prabhu said despite challenges, there was no increase in passenger fares in the last three years.

With the aim of providing better comfort and amenities in trains, Prabhu said, “40,000 coaches will be retrofitted which will bring huge relief for passengers.”

Railways has decided to equip about 40,000 coaches with modern facilities like mobile charging points, comfortable seats, redesigned interiors, passenger information system and bio-toilets among others.

On safety upgrade, Prabhu said the Finance Ministry has asked the Railways to raise Rs 5,000 crore every year for safety fund.

The government had announced the creation of a special safety fund of Rs 1 lakh crore over the next five years that will cover upgrading of tracks and signalling besides elimination of unmanned level crossings.

The Rashtriya Rail Sanraksha Kosh envisages spending of Rs 20,000 crore on safety upgrade every year.

However, Railways has so far received Rs 15,000 crore – Rs 10,000 crore from the central road fund and Rs 5,000 crore from the Finance Ministry – while it has been asked to raise Rs 5,000 crore from its own resources for the safety fund.

About the Railways future plan, Prabhu said, “Keeping customers as the focus, creating infrastructure at unprecedented level and modernising the Railways with cultural ethos and freight revamping is the strategy of the Railways.”

He said it is not only for the common man but also for other travellers so that more money comes in.

Facing stiff competition from other modes of transportation which are dominated by the private sector, transformative measures have to be undertaken to make railways competitive to retain their position of pre-eminence.

Among other measures being considered to increase the railways share in freight include time tabled goods trains, commissioning of dedicated freight corridors, end to end integrated transport solutions, customisation of rolling stock and practices to transport perishable goods.

“In the last three years we have taken some steps to address immediate problems. Bringing long term solution, with immediate solutions as well, adding doubling and tripling which has increased to 16,500 km this year which will bring in huge relief,” Prabhu said.

Indian Railways plans tie-up with Indian Oil Corp to cut on Expenses

Deal is likely to save Rs 2,000-2,500 Crore a year on Taxes for Indian Railways!

NEW DELHI: The railways will soon be reaching an understanding with Indian Oil Corporation (IOC) for refining crude oil imported by the transport behemoth itself — a move that is likely to save Rs 2,000-2,500 crore a year on taxes for the ailing transporter.

The railways consumes about 2.8 billion litres of diesel in a year, costing Rs 18,000 crore, and 17.5 billion units of electricity, costing Rs 12,300 crore.

“As an initial step, we have invited bids from consultants to work on the plan. We have received three bids. We are planning to import 500,000 tonnes of crude oil directly and will give it to IOC for refining. Our savings will be on account of taxes,” said Ravindra Gupta, Chief Administrative Officer, Indian Railways Organization for Alternate Fuel (IROAF).

The three players that have submitted bids are PricewaterhouseCoppers, KPMG and Sahi Tejarat, an overseas agency.

Once the railways increases crude procurement, oil marketing companies are likely to loose a bulk customer.

It is the aim of Petroleum Minister Dharmendra Pradhan and Railway Minister Suresh Prabhu to transform the railways into a contract manufacturer, and a series of meetings have already been held in this regard, Gupta said.

“We have zeroed in on IOC’s Vadodara unit to refine the imported crude,” he added.

As part of its strategy to move towards cleaner fuel, the railways has already installed rooftop solar panels in guard vans of six freight trains and is set to float tenders to get 200 such solar-powered guard vans.

In his 2015-16 budget speech, Prabhu had mentioned that the railways wanted to set up 1,000 megawatt (MW) of solar capacity on railway or private land and on the rooftops of railway buildings and trains. In addition, they also plan to put up around 200 MW of wind power plants by 2020.

Till date, the railways has set up solar and wind energy plants with total capacity of 50 MW.

Indian Railways seeks Partnership with Industry

NEW DELHI: The Indian Railways on Wednesday asked the industry to partner with it for the “complete transformation” of the railway network in the country.

Addressing the fourth Global Rail Convention under the aegis of PHD Chamber of Commerce and Industry here, Railway Board Member (Rolling Stock) Ravindra Gupta said close to 6,000 coaches would be refurbished in near future and this offered a huge opportunity as it involves investments of thousands of crores of rupees.

He added that new railway lines would also be added to the existing network of the railways which also offered “tremendous opportunities” for the private sector.

Railway Board Executive Director (Finance) Namita Mehrotra pointed out that safety and expansion of railways had undergone “massive changes” in the last two and a half years.

“The railways would spend Rs 1.31 lakh crore alone on its safety in next few years. It would also make huge investments on creating dedicated freight corridors for goods trains where their cost of operations would be minimum,” she said.

Czech Republic Ambassador Milan Hovorka and Deputy to the French Ambassador Claire Thuaudet offered expertise of their countries for efficient transformation of the Indian Railways at economic cost.

Railways takes a step-forward to join the Digital India bandwagon: Suresh Prabhu at ASSOCHAM meet

Minister of Railways Shri Suresh Prabhakar Prabhu inaugurated the Conference on “Digitization of Railway Supply Chain – A Leap forward in Ease of Doing Business” organized by Ministry of Railways in association with The Associated Chambers of Commerce of India (ASSOCHAM) and Indian Railway Institute of Material Management (IRLMM)

Chairman, Railway Board, A.K. Mital and other Railway Board Members and senior officials of Railway Board and representatives from ASSOCHAM were also present on the occasion.

While speaking on the occasion, Minister of Railways Shri Suresh Prabhakar Prabhu said that Indian Railways is also heading towards Digital Age. He also said that Ministry of Railways is working on Enterprise Resource Programme – a software which shall benefit Railways immensely. In the procurements, transparency has to be maintained throughout the process and ensure participation of everyone. While inaugurating Pan India Digitization of Railway Supply Chain, he stressed on optimum asset utilization and laid focus on framing tech specifications of all rly items for real time benefit of vendors as well as Indian Railways.

Shri Suresh Prabhakar Prabhu also added that Indian Railway is trendsetter among ministries to start E-Procurement in the year 2005-06. Digitisation of Railway Supply Chain is a Leap Forward in Ease of Doing Business & Transparency. Integrated Materials Management System is helpful in Optimum Asset Utilization, Efficiency in transaction, reducing cost of Doing Business. Integrated Materials Management System would eliminate barriers by Supply Chain Digitisation. He also said that Indian Railways has taken initiatives in E-tender, E-auction, E-procurements, E-scrap.

Shri Sunil Kanoria, President ASSOCHAM said that ASSOCHAM feels proud to be partner in organizing Digitization of Railway Supply Chain- A leap forward in Ease of Doing Business & Transparency. World class infrastructure is the key to a globally competitive economy and India’s objective of sustained double digit growth can only be achieved through a quantum growth in the infrastructure sector. As the backbone of transport infrastructure in the country, Indian Railways has stepped up their efforts to meet the growing needs of the economy. Indian Railways is poised to become the world’s biggest potential market for the introduction of modern state-of-the-art technologies and solutions for optimally harnessing the existing resources and deploying new technology solutions.

Deutsche Bahn, Indian Port Rail Corp may form Joint Venture in India

Germany’s Deutsche Bahn and India’s Indian Port Rail Corporation Ltd are in talks to develop rail connectivity for Indian ports
(Representational Image)

New Delhi: Germany’s Deutsche Bahn Engineering & Consulting is in talks with Indian Port Rail Corporation Ltd (IPRCL) to from a joint venture (JV) to develop rail connectivity for Indian ports.

Minister for road transport and highways and shipping Nitin Gadkari said in October that India and Germany were working together on projects worth Rs.1 trillion being implemented by IPRCL.

India has envisaged Rs8 trillion of investment until 2035 under the Sagarmala programme, which involves the construction of new ports to harness the country’s 7,517km coastline and setting up of as many as 142 cargo terminals at major ports.

“Indian ports have enough funds. The idea is to set up a JV with Deutsche Bahn Engineering & Consulting for setting up railway port connectivity projects. This will be a PSU (public sector unit) to PSU arrangement. Deutsche Bahn will bring in the latest technology,” said a person aware of the JV plans, requesting anonymity.

IPRCL and Deutsche Bahn signed a memorandum of understanding (MoU) on modernization of rail port connectivity and port rail facilities of Indian ports during the Maritime India Summit last year.

“Basically in railways there is always a lot of scope. So this particular German government company and they have signed an MoU for mutual cooperation…Now, as far as I believe, they have had a few rounds of discussions regarding where there could be synergies between the two,” shipping secretary Rajive Kumar said.

“This will improve the port hinterland connections to the railway network of Indian Railways. The MoU foresees comprehensive cooperation for designing the connection projects, drawing up the operations plan, and carrying out the engineering design and project management through to delivery to the port authority,” a spokesperson for Deutsche Bahn said, adding that negotiations are still in progress with IPRCL.

Queries emailed to IPRCL remained unanswered.

India will invest as much as Rs3.9 trillion for creating and upgrading infrastructure in the next fiscal year. Of this, the government has made an allocation of Rs2.4 trillion for roads, railways and ports in 2017-18. Projects worth Rs1 trillion are in various stages of implementation under the Sagarmala programme.

“The Budget has also made a proposal to enhance coastal connectivity through construction of 2,000 km of roads. Such projects over the medium term would provide construction opportunities of over Rs20,000 crore,” rating company ICRA Ltd wrote in a 3 March report. IPRCL was set up by the ministry of shipping for better cargo handling and to reduce the cost of logistics. Deutsche Bahn has been active in India, providing consultancy services to Dedicated Freight Corridor Corp. of India Ltd for the new freight transport line between Sahnewal and Pikhani that is part of the Eastern Corridor.

India has firmed up the contours of its ambitious multi-modal programme to reduce logistics costs and make the economy competitive. The strategy involves a reset of India’s logistics sector from a “point-to-point” model to a “hub-and-spoke” model and involves railways, highways, inland waterways and airports to put in place an effective transportation grid. India loses $6.6 billion every year in transportation delays for freight, says a comparison study of the survey data for the calendar years 2008-09, 2011-12 and 2014-15 by the Indian Institute of Management (IIM), Calcutta. These delays cost $14 billion per year on account of fuel consumption.

World Bank and Indian Railways Joint Workshop on Private Investment in Railways held

NEW DELHI: The Ministry of Railways and the World Bank organised a knowledge sharing workshop on leveraging private investment in Railways on March 29, 2017. The objective was to showcase the projects that provide opportunities to the private sector for investing their funds in Indian Railways. The participants include representatives of various funds and developers.

Speaking on the occasion, Suresh Prabhu, Minister of Railways said that there are huge expectations from Railways and to meet these expectations Railway needs to grow for which investment is required. Investment is required for decongesting the highly congested network and also for operations, maintenance and modernisation of Rolling stock. Recently a Safety Fund has also been created to clear all backlogs and modernise the safety infrastructure. Recently, we were successful in attracting FDI for our loco factories through a completely transparent bidding process. He felt that compared to previous years, there has been improvement in investment but by itself the investment requirements of Indian Railways are huge. There should not be concerns regarding servicing of the investments in Railways as being a transportation organisation, it has continuous cash flows. A lot of investment opportunities exist in Indian Railways and the workshop would be beneficial for structuring investments. There are possibilities of end to end logistics support. Unless logistics and transport come together, enhancement of business value would not be possible. Partnerships should be the guiding principle for the future. Railways have partnered with State Governments to form Joint Venture Companies. He was categorical that Indian Railways welcomes all long term & short term investors and the multilateral and bilateral agencies to partner with Indian Railways.

The Country Head of the World Bank, Mr. Junaid Ahmad said that Indian Railways is an important player in the economy and the backbone of India’s transportation sector. He opined that in the future growth story of the country, Indian Railways will have an important role to play. He also stated that this was a historic period for the country and for Railways and the Railway employees were fortunate to be a part of this history in the making. He gave example of successful partnership with the private sector such as the Sao Paulo water and sanitation company, Sabesp which serves more than 300 municipalities. He also highlighted the case of the Johannesburg where unbundling of different public agencies enabled them to raise resources from the local capital market and form partnerships with community based organisations and the private sector. In the case of Railways, he felt that apart from financing, the private sector can also bring in expertise in areas such as station development. In the years to come, once the DFC is commissioned, opportunities could be available to the private sector to run trains. Partnering with private sector logistics provider and other transporters will be key to fast ramping up of traffic.

Mr. Sujoy Bose, CEO of National Investment and Infrastructure Fund (NIIF) shared his experiences regarding PPPs. Presentations were made on station redevelopment, connectivity projects, State Joint Ventures, Dedicated Freight Corridors, Indian Railway Finance Corporation and also on the proposed Railways of India Development Fund.

Credit Suisse turns cautious on CONCOR as the PSU is losing advantage in their top six terminals to private sector

Credit Suisse turns cautious on Container Corporation of India (CONCOR), and says the company is losing advantage in their top six terminals to the private sector. P Alli Rani, Director-Finance at CONCOR confirms that the company lost its market share to private players in road sector. Below is the verbatim transcript of P Alli Rani.

Q: Can tell us what the market share is currently of the company versus other private players in some of the key verticals like Mumbai, Dadri, Ahmedabad etc. because the concern that some of the analysts have is that CONCOR is losing an advantage and losing some market share to the other players?

A: When you talk about market share, I would concede that we have lost some market share to road, but when you are talking about other players in the rail sector actually we have gained market share. In the last quarter we reported 75 percent and it’s what we hold in container transportation in the rail segment.

We have been losing to road during the last two years probably one big factor is the drop in oil prices and definitely that gave the edge over in terms of prices. The other thing that has happened is it could be better roads or better vehicles for road transportation. They are also gaining in speed which was definitely a unique selling proposition (USP) for rail transport earlier. But of course, we have, in coordination with Indian railways, trying to increase our speed also so that we deliver this container boxes in time at the ports. So, we are fighting with road.

However, as far as other container operators in the rail segment are concerned, I don’t think there is any evidence of us losing market share.

Q: In any case the total income had fallen in the last counter in Q3 by 5 percent. How is Q4 shaping up and maybe even a quarter later? If you can tell us something about how business might shape up next quarter as well?

A: This topline drop you saw was very specifically due to the cancellation of port congestion charges which we had to collect during the last year. If you remember, the Indian railways withdrawn these charges and so that had this impact on the topline. As far as business is concerned we are very dependent on trade, both international and domestic. We don’t see any major trend difference immediately. We have devoted a lot of time in the last three years and currently most of our projects are in fructification stage preparing ourselves for a surge in trade which we expect maybe towards the end of the next financial year with GST in place and also maybe some revival in exports which I hope would happen because lot of factors are conducive for that like exchange rate.

So, in the sense if Indian goods get cheaper in the market we hope exports would surge at least started increasing, so we expect all that to happen. However, the biggest worry in this entire sector is a capacity in the terminals. Of course, it is very closely dependent on the capacity of the Indian railways also, so we have little more to wait for the fructification, at least some phases of dedicated freight corridor (DFC) may increase our capacity in the track space, but for terminals also we have put in a lot of effort, money, time and strategy in expanding the size and content of a terminal so that we can give bundle of services to the customer and try to attract them away from road to rail.

So, that is the period we are going through, we have to notify them, we have to finish the construction, we have to market them. So as far as the business is concerned we haven’t really firmed up our outlook for the next year, but in the immediate future I would say that there may not be any major trend differences except probably if you talk about margins yes, we may gain because we have carried a lot of double stacking operations whereas business will continue in the present time.

Railways plan to save Energy worth Rs.41,000 Crore in 10 years: Railway Minister

NEW DELHI: Union Railway Minister Suresh Prabhu today said his Ministry has drawn up an action plan to save energy worth Rs 41,000 crore over the next ten years.

“I have prepared an action plan and it has been presented to the public (domain) also, that Rs 41,000 crore can be saved on energy during the next 10 years,” Prabhu said at a conference by Confederation of Indian Industry, here.

He said, through such an initiative, the Ministry has already saved almost Rs 4,000 crore on energy.

Referring to the allocation of Rs 1.21 lakh crore in the Union Budget presented last month, Prabhu said out of the Rs 1.21 lakh crore, the Ministry will get Rs 55,000 crore as “gross budget.”

“So what will happen to the remaining Rs 66,000 crore? We have to raise them,” he said.

Noting that the Ministry has undertaken an exercise to ensure faster processing of tenders, he said, instead of waiting to obtain an approval at the Ministerial level, now it is being done by the General Manager.

Calling for more efficiency and transparency in the operations of the railways, he said, “If you tell us where we need to bring in transparency, we will bring it.” On management of ministry’s expenses, he said the Ministry had earned about Rs 3,500 crore by selling scrap materials.

Railways appoints Ernst & Young as Transaction Advisor for redevelopment of 212 Category-C Suburban Stations

In addition to the 400-plus A1 and A-class railway stations that have been identified for redevelopment wherein the work at some stations had already been commenced, the Indian Railways has further selected 212 C-Class Category Suburban Stations (which are mostly falling in major Metro Cities) to be redeveloped and has roped in consultancy firm Ernst & Young for transaction advice. The carrier also plans to put up 50-60 premium stations for tender by the end of the calendar year. The railways recently issued tenders for 23 railways stations to be redeveloped.

“For the next lot, we are targeting to offer 50-60 stations for redevelopment by the later part of the calendar year. We have already appointed the transaction adviser for all zones except northern and western zones wherein technical bids by the associates chosen by the consultancy failed,” said a government official requesting not to be named. The railways has a total of 16 zones.

The C-class stations are in the suburban areas having sizable footfalls and potential. These mostly fall in the local train services in cities such as Mumbai, Delhi, Kolkata, Chennai and Bengaluru. “We will have to go to the Cabinet for approval as at present the railways cannot leverage the land,” said the official. Government rule states that committing government land for long term needs the Cabinet’s approval and the railways sought approval for the premium stations before issuing tenders.

“We will try to cover all states now, so that every state has representation and cover all the zones as well which were missing in the first lot,” said the official about the second lot to be offered. The railways will organise roadshows till May and June and also hold stakeholder meetings. The 23 stations have attracted interest from some big companies which have visited the sites; for example, Shapoorji Pallonji, Larsen and Toubro, ANS Constructions, Design Plus and Tata Realty visited the Faridabad station and developers such as Pir Panjal Construction, KC Industries, Ambuja and New Zeal have visited the Jammu station. The official, however, added that one has to wait and see if the interest converts to action.

The railways along with EY will assist zones in pre-bid meetings which will be held in March and April and after getting feedback, the processes will be refined for the next lot. EY will hold workshops with zonal railway officers, who will be dedicated to work on the project with developers, to increase their capabilities and help the zones in understanding and evaluating the market bids and prepare documents.

The railways plans to redevelop more than 400 A1- and A-category railway stations — which earn sizable revenue — across the country to provide passengers with modern amenities. The railways aims to monetise the land parcels around the station and air space to add to its coffers. Work on Habibganj in Madhya Pradesh and Gandhinagar in Gujarat, which are not part of the 23 put up on tender, has already started.

For each of the 23 stations, the railways has made a detailed information sheet which is part of the tender notice and contains earnings from the station, details of the city among others so that developers preparing concept are fully armed with information. In case more information is required, it can be asked at the pre-bid stage and the railways will keep supplementing information.

The railway also plans to talk to lenders and banks to ease the process of loans that developers will require to redevelop the stations.

A VVIP travels on the Churchgate-Dadar Suburban Train

Kristalina Georgieva, CEO, World Bank boards second-class compartment, seeks feedback on services

MUMBAI: World Bank CEO Kristalina Georgieva travelled in a Mumbai local train from Churchgate to Dadar. That, for those who are not familiar with Mumbai, is travelling in peak hours but in the opposite direction, against the crowd. Which means the trains are almost empty. During her first official visit to India, Georgevia opted to see the operations of the Bank-supported Suburban Rail System in Mumbai and had availed the opportunity to see how the operations of the World Bank-supported suburban rail system – which carries about eight million commuters each day – is serving a fast growing and urbanising India.

“India is our biggest middle income client. Its economic growth influences global growth. Its achievements in health and education contribute to the world achieving the Sustainable Development Goals. I am keen to learn more as India is a laboratory for the world to learn about what works in development and to find new ways to collaborate,” Georgieva said.

At 9:50 on Tuesday morning, Churchgate station appeared like any other weekday: quiet and fairly empty, till a group of photographers descended on the Slow local platform. There was a celebrity in their midst, a rather unusual traveller to the suburbs: World Bank CEO, Kristalina Georgieva, who had arrived to board the train to Dadar. Once she entered the second class ladies’ compartment, journalists, regular commuters, women police officers and Western Railway employees followed suit. They were and invited to speak to Ms. Georgieva, who was accompanied by World Bank India officials. She asked them a simple question: “What would you like to improve (about the Railways)?” The query didn’t take the commuters much effort to answer: increased safety, and more comfortable journeys. “I spend nearly one hour on the train every day,” said Reshma Singh (30). “By now I have gathered a group of my friends to travel with me every day, but the journey is still tiring, because of the open doors, the crowded compartments, and the length of the journey.”

In Mumbai on a two-day India visit, Ms. Georgieva sought to gain this information as feedback for the World Bank’s involvement with the Mumbai transport system. The World Bank is a financial contributor to the Mumbai Urban Transport Project, which has recently completed its second phase. This phase has looked to expand Mumbai’s suburban railway corridors, increase the size and frequency of the trains, reduce trespassing to increase passenger safety, improve trains’ punctuality, and enhance the security and comfort of train journeys.

The women police officers accompanying Ms. Georgieva also sat down to discuss their desire for increased safety on the trains. Ms. Singh was also one of the “regular travellers” World Bank India officials invited to sit with Ms. Georgieva and share their feedback with; the media, meanwhile, was unstoppable. At each station, photographers kept clicking through the windows. Western Railway employees then sat down with Ms. Georgieva to talk about their jobs; when they mentioned how they loved what they were doing, Ms. Georgieva said it was great to see women employees of the Railways, and that there need to be more. Journalists observing from the sidelines were told not to ask questions, and to give answers instead. Unanimously, safety and comfort were the top replies.

“I feel privileged that World Bank supports the Mumbai commuter rail,” Ms. Georgieva said. “From my understanding, speaking to women on the train today, the leadership wants an enjoyable experience, women have positive words to say, and safety is a big concern.” She emphasised that, going forward, safety measures would be increased with cameras, lighting, and an increased police presence.

Ms. Georgieva, demonstrating the intended effect of decongesting Mumbai’s suburban railways, said an easier travelling experience would ensure that more women could work in the railway stations.

“The leadership here at the station today has all talked about wanting an enjoyable experience. I would like to see more women working, which means improving not just the efficiency of the trains but also the quality, dignity of life and enjoyment of railway travel,” she said.

Georgieva, who reached Mumbai on Monday night, is also scheduled to meet with Maharashtra Chief Minister Devendra Fadnavis and RBI Governor Urjit Patel.

World Bank CEO to visit Mumbai Suburban Rail system

During her first official visit to the country, Georgieva will meet with senior leaders at a time when India’s economic growth is “one of the bright spots” in the global economy, the World Bank said in a statement. Kristalina Georgieva will hold discussions with Arun Jaitley and other key policy-makers
Kristalina Georgieva, Chief Executive Officer of the World Bank

MUMBAI: World Bank’s Chief Executive Officer Kristalina Georgieva will see the operations of the Bank-supported suburban rail system in Mumbai during her India visit starting today.

During her first official visit to the country, Georgieva will meet with senior leaders at a time when India’s economic growth is “one of the bright spots” in the global economy, the World Bank said in a statement.

“India is our biggest middle-income client. Its economic growth influences global growth. Its achievements in health and education contribute to the world achieving the Sustainable Development Goals.

“I am keen to learn more as India is a laboratory for the world to learn about what works in development and to find new ways to collaborate,” Georgieva said.

She will reach Mumbai tonight. As per the statement, she will hold discussions with the Finance Minister Arun Jaitley, and other key policy-makers. She will also meet with Chief Minister of Maharashtra Devendra Fadnavis and RBI Governor Urjit Patel.

“While in Mumbai, she will have the opportunity to see how the operations of the World Bank-supported suburban rail system – which carries about eight million commuters each day – is serving a fast growing and urbanising India,” the World Bank’s release said.

She will also visit a school serving low-income households, and children with special needs (part of Centre’s Sarva Shiksha Abhiyan programme, supported by the Bank) to see how Mumbai’s administrators are striving to ensure that basic services are delivered to all residents of the city, one-third of whom live in slums.

Kristalina Ivanova Georgieva-Kinova is a Bulgarian politician and the current CEO of the World Bank. Until 2017, she was European Commissioner for Budget and Human Resources in the college of the Juncker Commission. From 1993-2010, she served in a number of positions in the World Bank Group, eventually rising to become its vice president and corporate secretary in March 2008. She has also served as a member of the board of trustees and associated professor in the Economics Department of the University of National and World Economy in Bulgaria. On 27 September 2016, the Bulgarian government nominated Kristalina Georgieva for the post of United Nations Secretary-General. Her short run Secretary-General at the UN ended following a vote at the UN Security Council on 5 October, where Georgieva ranked number eight out of ten candidates. In the same vote, António Guterres got the support of the Security Council for the post of UN Secretary-General. On 28 October, the World Bank announced that Georgieva would become the first CEO of the bank starting on 2 January 2017.

Georgieva was named “European of the Year” in 2010 and “EU Commissioner of the Year” as an acknowledgment of her work, in particular, her handling of the humanitarian disasters in Haiti and Pakistan. Previously, she had been nominated among the candidates for the category “Commissioner of the Year”, the prestigious award organized by the European Voice newspaper.

Indian Railways inks pact with ICAI for Accrual-based Financial System

ICAI’s Accounting Research Foundation signs pact with Railways. Railways will seek to introduce accrual accounting at 17 Railway zones

NEW DELHI: Chartered accountants’ apex body ICAI today signed an agreement with the Indian Railways for moving its accounting system to the accrual format.

“Accrual based financial statement will support Indian Railways in better utilisation of available resources, estimation of future liabilities and prioritisation of spending.

“It will also pave way for best financial management practices to be introduced in Indian Railways,” ICAI said in a release.

The pact is for “introducing the accrual-based financial statement as an additional set of accounts to existing cash-based government accounts”.

It has been entered into between ICAI Accounting Research Foundation (ICAI ARF) and the Indian Railways. The foundation is the research arm of the Institute of Chartered Accountants of India (ICAI).

Accrual system of accounting would provide a better picture of the particular entity’s financial position.

A pilot project for introduction of accrual-based financial statement as an additional set of accounts at North Western Railway at Jaipur (Rajasthan) and Rail Coach Factory at Kapurthala (Punjab) was successfully implemented by ICAI ARF, the release said.

Now, the agreement signed by ARF with Railways will seek to introduce accrual accounting at 17 Railway zones and 8 production units across the country, sources said. The agreement will be valid for 18 months. The agreement was signed by V. Sagar, Director, ICAI ARF and Secretary, ICAI and Sanjeev Sharma, Deputy Chief Project Manager (Accounting Reforms), Northern Railway in the presence of Shahzad Shah, Financial Commissioner, Indian Railways and Nilesh Shivji Vikamsey, Chairman, ICAI ARF and President, ICAI.

The interesting aspect is that accrual based financial statements will serve as an additional set of accounts to existing cash based accounting.

Accrual based financial statement will support Indian Railways in better utilisation of available resources, estimation of future liabilities and prioritisation of spending. It will also pave way for best financial management practices to be introduced in Indian Railways.

This agreement follows implementation of the pilot project for introduction of the Accrual based Financial Statement as an additional set of Accounts at North Western Railway at Jaipur and Rail Coach Factory at Kapurthala by ICAI ARF.

The CA Institute’s ARF will not be implementing this on a pro-bono basis, sources said.

World Bank help sought to identify areas for Rail Safety fund

NEW DELHI: The Railways Ministry is planning to consult the World Bank to identify areas that require investment from the special rail safety fund announced in the Budget. “We are planning to take the advice of World Bank in identifying areas that require technological advancement for rail safety,” a top Railway Ministry official said, on condition of anonymity. “We will take the World Bank’s help on deciding where and how to spend the money out of the rail safety fund.”

Finance Minister Arun Jaitley announced setting up a special safety fund named ‘Rashtriya Rail Sanraksha Kosh’ with a corpus of more than Rs. 1 lakh crore over a period of five years in Budget 2017-18. The Railways is exploring advanced ways to automate track inspection and track surveillance. “We are discussing the possibility of using rail robots to detect fractures in railway tracks,” the official added.

The Minister in his Budget speech had said that the government would lay down clear-cut guidelines and timelines for implementing various safety-related works to be financed from the rail safety fund. The Finance Ministry will contribute 75% towards the fund and the remaining amount will be generated by the Railways from its own resources.

The Railway Ministry had asked the Finance Ministry to set up the fund last year and proposed spending one-third of the special fund towards eliminating unmanned level crossings. Other areas included: track works, bridge rehabilitation works and track vehicular ultrasonic testing system, among others.

Roadmap ahead for RailTel is a steep Growth Path requiring Organizational Excellence at its Best

Arun K Jain, Group General Manager-Corporate Coordination, RailTel Corporation of India Ltd

NEW DELHI: RailTel – a Telecom PSU under Ministry of Railways, has been growing at a very fast and consistent pace, with state-of-the-art infrastructure and dynamic leadership of the management. The future plans of RailTel are well thought through and promise continued growth for years to come.

Before we deliberate on where RailTel is headed and the roadmap it has charted for itself, let us see where it stands at present.

With a background of executing various projects of national importance (NOFN/BharatNet, USoF projects in North East and NKN), RailTel’s contribution towards Digital India dream is immense. Starting the year with a target of providing RailWire Fast Wi-Fi services at 100 stations in 2016, RailTel launched the service at 110th station on December 31, 2016, the New Year’s eve.

This project alone provides connectivity to over 5 million users every month. RailTel’s Telepresence Service (TPaaS) has been used extensively by railways (over 100 events connecting nearly 300 locations during the year) and other government offices, enabling meetings and events being done remotely, cutting down on costs and saving time.

RailTel is also working on Smart City projects, various state governments’ projects for connecting their offices or providing connectivity to thousands of government schools and panchayats. In terms of revenue, RailTel had a 17 percent year-on-year revenue growth in FY 2015-16.

To augment its capabilities in order to sustain the high growth path RailTel is on, every year investment is being made to continually upgrade the network and technology. In FY 2016-17, 150 crore is being invested in RailTel’s network.

RailWire – the home broadband service of RailTel which was ambitiously developed by RailTel in association with Bangalore based Sobha Renaissance Information Technology (SRIT) has more than 1 lakh active subscribers as on date in New Delhi, Ranchi, Varanasi, Patna, Bhubaneswar, Agra, Ludhiana, Mysore, Bangalore, Ambala, Gurgaon, Kolkata, Surat, Chandigarh, Chennai, Mumbai, Lucknow, Amritsar, Jaipur, Meerut, Panipat, Kanpur, Allahabad, Bangalore, Ernakulam, Shoranur, Hubli, Tiruvananthapuram and Indore etc. This is one step in right direction. The competitive service is bound to grow exponentially. With continued focus on providing various services to enterprise sector, RailTel has seen a good growth from this business segment with size of the orders increasing as well. Business from enterprise sector formed almost 20 percent of overall RailTel’s revenue in FY 2015-16.

With reach in all the major population centers of the country, ICT and system integration projects are being seen as a promising growth area for RailTel. Bundling lot many different services, data center services, disaster recovery, leased line, MPLS-IP VPN, telepresence, applications support, and hosting, etc., and providing single service point with dedicated customer support, RailTel offers simplicity and ease of operations to its customers. With a number of new ICT and SI projects successfully executed by RailTel, the required human, technical, and knowledge capability is very much on display. To have focused approach and dedicated workforce in the field of project business, RailTel created a wholly owned subsidiary RailTel Enterprises Limited.

Growing trust in capabilities and potential of RailTel by the Ministry of Railways and other ministries and agencies of the government is visible in many new initiatives and projects. In 2017, many important projects being executed by RailTel shall also remain in focus –implementation of Railway Display Network (RDN) at 2000 stations, Video Surveillance System at about 1000 railway stations, RailWire Wi-Fi services at 200 more stations by the year end. In 2016, RailTel also started working on ERP application support, development and implementation services through in-house ERP team of RailTel. This service shall see a major completion of phase-I work of National Optical Fiber Network (NOFN, now called as BharatNet), also targeted in 2017. Projects of network creation through fiber laying in two North-East telecom circles, NE-I and NE-II, under USoF, are expected to be completed in 2017.

In the current financial Year (FY), RailTel is striving to achieve a year-on-year revenue growth of 20 percent and in FY 2017-18 intends to raise the growth pace further. This high growth roadmap of RailTel is only possible through a committed workforce ensuring in-time delivery of services and execution of projects as per SLAs. With rapid growth of the organization, new manpower at all levels of the organizational hierarchy is being inducted with various skill sets from different backgrounds – private sector, ministries and PSUs, MNCs, etc. In 2016, RailTel inducted over 150 employees at various levels across all verticals. This, supported by robust training and development policies ensures that RailTel always has the required manpower with requisite skill sets.

Building up on the robust legacy of the institutional strength inherited from Indian Railways, RailTel has established itself as a renowned name in extremely competitive telecom sector with ever-thinning margins, while contributing toward the national goals. The roadmap ahead for RailTel is a steep growth path requiring organizational excellence at its best. (Courtesy: Communications Today).

RailNews Opinion: In whatsoever manner we consider, RailTel’s foray is confined to certain niche and select areas only. RailTel is not able to focus on certain mission mode projects at State levels like State FiberGrid projects undertaken by certain State governments in India that provides infrastructure for affordable and high speed broadband connectivity and Digital services in Districts, Mandals, Gram Panchayats, villages and households and government offices, educational institutions, hospitals, banks and other public service institutions for providing the G2G & G2C services. Andhra Pradesh and Telangana states have on-boarded firms like Ernst & Young and PWC as Consultants for the FiberGrid projects and have successfully rolled out the services in some areas.

The Govt.of Andhra Pradesh had ambitiously launched AP FiberGrid and commissioned the triple play services successfully in many areas of the state in the recent past. However, despite having a serving IRTS cadre Railway officer on board of AP State FiberGrid Corporation Ltd on deputation, RailTel is not able to get engaged  in the AP FiberGrid for reasons not known.

Likewise, in case of T-FiberGrid project which was ambitiously launched by Telangana State Government wherein the Optical Fiber Communication Network will be built piggybacking on Mission Bhagiratha project (that provides drinking water to rural Telangana) to save digging and trenching costs, RailTel could not proactively got engaged, despite having sizeable OFC network in Telangana.  This speaks about either lack of sufficient resources in Sales and Marketing discipline or the practice within RailTel or otherwise the focus to address such requirements.

As regards RailWire services, the business model and the roll out, RailTel can examine formation of a Joint Venture Company in association with Google and SRIT for roll out the services across the country.  RailTel has to bank on its strength and foray in the markets with Triple-play services to boost its revenues.

RailTel should also focus on various Startups emerging fastly in the Indian IT & Telecom sectors which are enormously contributing for various innovations in Social, Mobility, Analytics and Cloud, leave alone the fastly emerging FinTech enterprises.

In all, RailTel has necessary capabilities, expertise, professional executive team, network, reachability and exposure to spread its wings to catch up with innovation in the era of Digital India.

Railway Minister to lay foundation for Dhasa-Jetalsar Railway line Gauge Conversion project

SURAT: Railway Minister Suresh Prabhu will be visiting the Diamond City on Sunday to lay foundation stones for four railway projects in the state including Dhasa-Jetalsar and also launch Disha Mobile application.

The Railway Minister will be performing the foundation stone laying ceremonies and other launches from Southern Gujarat Chamber of Commerce and Industry’s (SGCCI) Samruddhi building at Nanpura here. These include Dhasa-Jetalsar gauge conversion project, 35 road under-bridges in Gujarat and infrastructural facilities for periodical overhauling of Covered Boggie Wagon Type with Air Brake and Heavy Load (BCNHL) wagons in Vadodara’s Pratapnagar workshop.

The Railway Minister will also be launching the DISHA App and dedicate the major routine overhauling depot for wagons at Gandhidham and locomotive simulator at Sabarmati in Ahmedabad, sources said.

Prabhu will be addressing a public meeting at Nilgiri ground at Limbayat in the afternoon. The event has been organized by the local BJP unit.

Asked about the reason for selecting Surat as the venue, member of Railway Board’s Passenger Service Committee (PSC), Rakesh Shah, said, “Even I do not understand why the minister selected Surat to lay foundation stones for the projects in north and central Gujarat. I have been flooded with queries from many regarding this . But, we will know on Sunday if the minister makes any special announcement for Surat.”

Indian Railways to have improved Operating Ratio of 89-90% by 2021: CRISIL Research

NEW DELHI: The operating ratio of Indian Railways will improve to 89-90% by 2021 once the current investment starts bearing fruit, a CRISIL research report has said.

Railways currently has an operating ratio of 94%. Operating ratio indicates is the amount railway spends to earn 100 rupees. An operating ratio of 94% means railway is spending the same amount to earn Rs 100. The surplus amount is used by railways for development and capacity building works.

CRISIL believes the four-pronged strategy of plucking the low-hanging fruit by prioritizing and commissioning the vast backlog of projects, amounting to ~Rs. 3.3 trillion, standardizing and expediting project sanctioning to ensure a robust project pipeline and facilitating time-bound execution, transforming the DNA of the institute via greater empowerment and accountability to enhance efficiency and focusing on bolstering its own finances will help reinvigorate Indian Railways.

According to the report, railway financing is expected to be less of a constraint than in the past, given external funding–including institutional financing, multilateral borrowings and participation of stakeholders such as state governments and private players.

The research expects investment of Rs. 469 billion in coaches over FY16-20, with Linke Hoffman Busch (LHB) and self-propelled units preferred to improve safety and speed.

The report says during FY16-20, rail freight growth is expected to be 7-8% annually, compared with just 3-4% between FY12 and FY16 as more capacities come on line due to phased commissioning of the DFCs and ongoing network decongestion measures.

Merger of Rail Budget with Union Budget – Modi Government breaks the Legacy

Vikram Doshi, Partner-Tax, KPMG India

The availability of data and assessing the trends/projections may pose a challenge, feels Vikram Doshi, Partner-Tax at KPMG India

The Union Budget also referred to as the Annual Financial Statement in Article 112 of the Constitution of India (1949) was for long presented on the last working day of February by the Finance Minister in the Parliament. Breaking the legacy, the government is all set to present the Budget on 1 February 2017 with an intent to complete the legislative exercise and approve the Finance Bill before the start of the Financial Year (FY) on 1 April.

Additionally, the decision of advancement of Union Budget was taken with the view to help ensure that the spending on schemes starts from 1 April to provide a boost to the economy. This was to cure the practice in the earlier years where spending would start after the first quarter of the Financial Year. From the perspective of the government departments, agencies and state owned companies it may help ensure that they get their full allocations to work with from the first day of the financial year. From the perspective of the taxpayers, they may get sufficient time and much required clarity in working out their tax planning and advance tax payment schedules based on tax proposals put forth.

While certainty, clarity and the timing might prove to be of advantage for the tax payer and the government, the availability of data and assessing the trends/projections may pose a challenge. To read the Budget on 1 February 2017 the preparations would have begun from as early as October 2016. The projections would have been made based on the data for the first six months of the Financial Year. To begin with data of less than six months and making projections for the next year and subsequent years may be a daunting task.

The elections of five states (Uttrakhand, Manipur, Goa, Punjab and Uttar Pradesh) are expected to be held in the coming months and the government is instructed to follow the Model Code of Conduct and not announce any scheme or incentive for these states. It needs to be considered whether such a condition could hamper the reforms that could be brought about in the five states through advancement of the Union and Railway Budget.

The merger of the Union Budget and Railway Budget was proposed by the Railway Minister and endorsed by the NITI Aayog (National Institution for Transforming India- Government of India’s policy think-tank established to replace the Planning Commission). The history of having separate Budget dates back to the British era. The idea was to have a focus on the most important infrastructure network of India then, which made up for substantial portion of the countries general budget. The NITI Aayog noted that in current times a distinct Railway Budget remained merely a practice/formality as the Railway Budget size had diminished relatively to the general Budget.

This will also save the time of the parliamentarians by not having to approve and pass two separate Bills. The railways were paying a dividend to the government for getting gross Budgetary support which will now be done away with, saving a huge amount of its financial resources.

The consolidation of the Budget raises a concern of decrease in the transparency of the railway accounts and their performance. A reduction in the allocation of funds to the Union Budget after the merger would mean a necessary similar cut in the allocation of expenses to the railways.

In view of the advancement of the Union Budget, there is a speculation in terms of whether there will be any change in the Financial Year to be in sync with the calendar year i.e 1 January to 31 December. No announcements have been made yet in this regard. Post demonetisation, all eyes are now on the measures that will be announced in the Union budget especially in terms of its effective and timely implementation.

All views or opinions expressed herein are those of the author and do not necessarily represent the views of KPMG in India.

Indian Railways may create Business Opportunities worth Rs.6.7 Trillion by 2020: CRISIL

MUMBAI: Estimating Rs 6.7 trillion business opportunities for the Railways in 5 years, CRISIL (formerly Credit Rating Information Services of India Limited) today said the upcoming Union Budget could allocate funds to the tune of Rs 1.3-1.4 trillion in this sector for 2017-18, a move which could help in faster execution of projects in this space.

According to CRISIL Research, the Central government’s move to reinvigorate Indian Railways offers unprecedented business opportunities worth Rs 6.7 trillion by 2020.

The business opportunities could be the largest compared to the rest of the world except China, and would be more than 2.5 times the capital expenditure seen in five fiscals to 2015.

“We expect the upcoming Union Budget to earmark Rs 1.3 – 1.4 trillion spending for next fiscal,” the report said. “The pipeline of projects, too, is ramping up as sanctions gather pace. Around Rs 1.1 trillion worth of projects were sanctioned on an average in the past two fiscals in key segments compared with an average Rs 250 billion in the four fiscals preceding,” it added.

CRISIL Research senior Director Prasad Koparkar said the gross budgetary support would mainly go towards network decongestion and expansion.

“Secured debt of Rs 1.5 trillion from the Life Insurance Corporation of India (LIC), and Rs 523 billion loan from the World Bank and the Japan International Cooperation Agency have already been tied up,” Koparkar said.

“These will lead to higher allocation for, and faster execution of, strategic and remunerative projects,” he added.

As per the report, loan from LIC is expected to boost investments in electrification and track-doubling projects, which offer adequate returns.

The multilateral funds, on the other hand, are expected to aid investments in dedicated freight corridors (DFCs).

“Consequently, we see planned capex on network decongestion and rolling stock materialising largely by fiscal 2020,” the report noted.

Going by CRISIL’s estimates, high-impact projects involving decongestion would be prioritised over new lines, and open up a Rs 2.4 trillion business opportunity.

Investment in rolling stock – locomotives and coaches – is seen at Rs 1.1 trillion. Of this, purchase of locomotives would account for nearly half. Further, investments in safety are likely to treble to Rs 900 billion, but will fall short of Rs 1.27 trillion target. “Bulk of it will be to build rail under-bridges and over-bridges, with the rest for track renewal, signalling and telecom, etc,” the report said.

Slow land acquisition halts Baddi Railway link project

Baddi: The Baddi rail link project is hanging fire due to the delay in land acquisition by the Haryana Government. A delegation led by the chairman of the Himachal chapter of the Confederation of Indian Industry (CII) Sanjay Khurana had met Dinesh Kumar, Divisional Railways Manager, Ambala.

Khurana said the project was delayed as the land acquisition process in Haryana was slow, whereas in Himachal Pradesh the rate at which the land was to be acquired awaited the Deputy Commissioner’s approval.

He said the DRM, Ambala, had assured support to the project and advised the CII members to meet Akshay Sood, Adviser – Planning, entrusted with the responsibility to coordinate with the Railways on behalf of the state government. The CII delegation was also asked to meet Ravi Gupta, Deputy Chief Engineer – Construction, Northern Railway, for further information on the project.

Khurana said they would soon meet the officials concerned and request them to expedite work on the project.He said the state government would bear 50 per cent of the cost of land acquisition for the project. A sum of Rs 45 crore had already been released by the state government to the Railway Board.

The delegation raised the issue of connecting Kala Amb or Paonta Sahib with the proposed Eastern Freight Corridor. The DRM said Kala Amb was not a part of the plan while Naraiangarh would be connected to the corridor via Jagadhri – Chandigarh feeder line.

The DRM suggested the CII members to send a request to the Railways through the state government for opening a railway reservation counter at Baddi.

JICA shows interest in funding Surat Metro Rail Project

Surat: Japan International Corporation Agency (JICA), the Japanese funding agency, has shown keen interest in financing the Rs 4,000 crore Surat Metro Rail Project. The detailed project report (DPR) of the 35-km-long metro rail, being prepared by Delhi Metro Rail Corporation (DMRC) along with CEPT University in Ahmedabad, is likely to be ready in next six months.

A five-member team of international management consulting firm Ernst & Young, which functions as financial assessors of JICA, has been camping in Surat to assess demand and possibility of adopting several corridors. After getting the financial assessment report from Ernst & Young, JICA will discuss the same with the state and Central Government, and implementation is expected to begin after the financial loan is granted. JICA is known to be interested in financing metro project of two cities in India, one of them being Surat.

While officials from JICA were in Surat for assessment of the project cost, the agency will take a final call once the DPR is ready by March 2017.

Meanwhile, DMRC and CEPT are conducting a study to check the feasibility of different corridors and making specific demand assessment of each corridor. According to CEPT, the work is going on and more than a dozen corridors are being assessed. The state government has also named Metro Link Express Gandhinagar-Ahmedabad (MEGA) as the nodal agency for implementation of metro projects in the different cities of the state.

Surat – a city with poor connectivity that it is more difficult to reach it from Bangalore than it is to fly to London

Unlike some of the other big cities, like Mumbai, Calcutta, Chennai and even New Delhi, Surat was not built by the British. It was built by Indians and it has a recorded history going back centuries. It was already a big city in the period of the Delhi sultanate and it was the largest provider of tax revenue on entire the subcontinent during the Mughal rule. In 1608, the British first landed here, when it was famous as a big and successful port and trading centre under emperor Jahangir. Three centuries later, though the port shifted to Mumbai, it was still large and famous enough across the world for Leo Tolstoy to write a short story called ‘The coffee house of Surat’. Today Surat is the world’s largest diamond polishing centre (about two thirds of all diamonds found anywhere in the world have passed through Surat). And it is one of the world’s largest textile centres. It has a population roughly the size of London and it has the highest per capita income of any city in India.

From Bangalore, one won’t get a flight to Surat. This is because Surat has an airport that is dysfunctional. No private airline flies to the city. Shortly after this government took over, a buffalo walked into the Surat airport and an airplane crashed into it, damaging its jet engine. This flight, the only private one connecting Surat to Mumbai and Bangalore, was discontinued.

Minister for Civil Aviation Ashok Gajapathi Raju said the beast had come in through a gap in the fence which he ordered would be walled up. But this has not inspired any confidence from the airlines and so they have avoided Surat for the last two years. To get here, I had to first fly to Mumbai and then drive for five hours. The distance is 300 kilometres and the road is part of India’s best highway network, the golden quadrilateral, which connects Mumbai to Delhi. This is a heavily used highway, perhaps the busiest in India, and so the halted cars and trucks form a line many kilometres long.

This is the same route that India’s bullet train is taking. The high speed rail network starts at Ahmedabad and comes to Surat, which is about mid way, and then to Mumbai.

World Bank, AIIB funds to put Mumbai MUTP-III Rail projects on right track

World Bank MUTPMumbai: The ambitious Mumbai Urban Transport Project (MUTP) III infrastructure projects worth more than Rs.10,000 crore will be jointly financed by the Asian Infrastructure Investment Bank (AIIB) and the World Bank in a 40:60 ratio.

The project, aimed to expand the suburban rail network across the Mumbai Metropolitan Region (MMR), was cleared by the union Cabinet on Wednesday and was extensively discussed by the World Bank, AIIB officials and Mumbai Rail Vikas Corporation (MRVC) on Thursday in the day-long meeting.

The opposition parties, meanwhile, said that with the central nod commuters will have to pay more for the repayment of MUTP-III funds. Railway officials are proposing a loan of Rs.7,000 crore from the international financial institutions, while the remaining Rs.4,441 crore will be equally funded by the railway ministry and the state government.

“The World Bank and AIIB will jointly fund the loan amount for the project in a 60:40 ratio. We are discussing the process with them and in all probability, the tenders will be floated by the end of the month,” said Prabhat Sahai, chairman and managing director of MRVC.

The MUTP-III project comprises construction of the third and the fourth lines between Virar-Dahanu (63km), Airoli-Kalwa (4km), which will provide easier access to suburban commuters between Kalyan-Panvel, and doubling of Panvel-Karjat (28km).

The MRVC is likely to start the work on all the three projects by October in 2017. “The project will take at least five years, but we are trying to finish it faster; specially, the Kalwa-Airoli link, which is a high priority project,” added Sahai. Meanwhile, the Congress raised questions over the union Cabinet’s nod to MUTP-III project, alleging that it would increase the fare.

Citing the condition laid down by the NITI Aayog, the Congress said that commuters will be burdened if the nod to the project comes with the rider. Congress spokesperson Sachin Sawant said that Niti Ayog had directed the railways to go for an automatic fare revision before approving the project.

Rail officials said if the fare revision is implemented it will be for the entire nation and not only for Mumbai.

IT, Digital, ERP & Real-Time to take Centre Stage in Railways: Suresh Prabhu

suresh-prabhu-at-ciiBangalore: One of the ambitious technology initiatives of the Indian Railways, Enterprise Resource Planning (ERP) project – expected to bring in radical changes in the railway operations, will allow officials to monitor the movement of trains across the country from one place, said Railway Minister Suresh Prabhu on Wednesday.

He was delivering the inaugural address through video-conferencing of the 24th edition of CII National Quality Summit, organised by the CII Institute of Quality, themed ‘The Digital Transformation of Business – Implications for Quality’, that commenced in Bengaluru on Wednesday.

“IT and digitalisation is the key for development and transformation of the Railways. Integrating various services is expected to bring radical changes in the service delivery,” he said.

“Today, there is a manifold change taking place across the world due to digitalisation. It is a great opportunity for us, as India is well positioned to take advantage of this. With digitalisation, the quality of service will be the same irrespective of who the end user is,” he said.

Speaking specifically on the digital initiatives taken up by the Railway Ministry, he said, “All Railways operations are being moved towards digital. We have developed several elements of change in the way the Railways functions to keep up with the evolving technology. We have put in place a customer complaint redressal mechanism which is completely transformative in nature through which we have been able to provide real-time assistance to the people. We are in the process of developing a system whereby any complaints made through different platforms, like SMS, Twitter, phone etc. are integrated into one. We are also implementing GPS monitoring system for the Railways. Another important area of work in progress is setting up of a public Wi-Fi which will be the largest in the world. The customer will benefit from improvements in quality,” he said. He also stated that ERP is introduced all the activities can be monitored from a centralised cell.

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GPS monitoring

Railways are also in the process of implementing GPS monitoring system for the railways. Another important area of work in progress is the setting up of a public Wi-Fi which will be the largest in the world.

“We are also in the process of implementing ERP towards going paperless. The end result would be customer benefit from improvements in quality,” explained Prabhu.

The CII National Quality Summit, themed ‘The Digital Transformation of Business – Implications for Quality’, commenced in Bengaluru.

Prabhu said: “Today, there is manifold change that is taking place across the world due to digitalisation. It is a great opportunity for us, as India is well positioned to take advantage of this. With digitalisation, the quality of service will be the same irrespective of who the end user is.”

Delivering the keynote address Naushad Forbes, President of Confederation of Indian Industry, said: “While quality in manufacturing is absolutely critical, we need to go beyond manufacturing quality to be successful.”

He further emphasised on six critical areas that determine quality, including human fit, craftsmanship, emotional connect, aesthetics elegance and sophistication, symbolism and consistency with global constraints.

R Mukundan, Chairman of CII Institute of Quality said that companies have to look at digital as a way of life going forward as digital enables better quality of products and services. Companies that embraces digital processes, are the ones that will be at the cutting edge of change and transformation. It is important that Quality and Innovation should take center stage for campaigns like Make in India, Swachh Bharat Abhiyan, Digital India, and StartUp India, to succeed.

Digitisation

Yaduvendra Mathur, CMD of the Export-Import Bank of India, said: “Growth with equity and inclusive growth is a challenge and that is where digital transformation of businesses are heading. The industry should participate and re-dedicate in a positive way in transforming the country, by moving towards the digital way of doing business to boost our GDP growth.” Presenting the Mckinsey & Company report “Quality in the Digital Era”, Jaidev Rajpal, Partner, Mckinsey & Company, said: “Digital technology is changing the way products and services are conceptualised and delivered and the nature of quality. Successful companies are increasingly combining their quality strategy with the digital vision, while constantly iterating on product development. They proactively adopt digital technologies to drive impact across the value chain and emphasise on agility in the government and organisation while building a culture that brings together customer focused cross-functional teams.”

MMRDA approves 118km Metro routes to connect Suburbs

The Mumbai Metropolitan Region Development Authority (MMRDA) will undertake this work, while the Delhi Metro Rail Corporation (DMRC) will work as an advisory for the finalised Metro routes.

md-mmrdaMumbai: The Maharashtra Urban Development (UD) Department has approved 118km of Metro lines, which will connect various parts of the Mumbai suburbs. The move is aimed to ease traffic congestion.

According to the department notification, the government has approved following lines: Dahisar-DN Nagar (27km), Bandra-Mankhurd (13km), Wadala-Ghatkopar-Thane-Kasarwadavali (22km), Wadala-RA Kidwai Marg (8km), Dahisar (E)-Andheri (E) (18km), Andheri (E)-Bandra (E) (9km) and Jogeshwari-Vikroli Link road (11km).

The Mumbai Metropolitan Region Development Authority (MMRDA) will undertake this work, while the Delhi Metro Rail Corporation (DMRC) will work as an advisory for the finalised Metro routes. The estimated cost for the Metro-II route (Dahisar-Charkop-Bandra-Mankhurd) is Rs10,986 crore, while Metro-IV route (Wadala-Ghatkopar-Mulund-Thane-Kasarvadavli) will cost an estimated cost Rs14,549 crore.

The Government has also approved the decision of raising loans for these approved Metro lines from the Asian Development Bank (ADB). In addition, MMRDA can also take loans from the World Bank or any other internationally approved bank. The Government will not take any responsibility of repaying the loan.

Moreover, the Government and semi-Government agencies will have to rent the land under them to the MMRDA for development of the Metro lines, at a reasonable rate. If it requires to acquire the land permanently, the acquisition will be done as per the new Land Acquisition Act, 2013.

A senior UD official said the Maharashtra Government has declared Metro an important and urgent project, so that various approvals required from the Central and Western Railways could be sought on an urgent basis.

“The Metro project has to be completed within the stipulated time. The State Government will provide power for the project at a reasonable rate. The Government has also decided to have an integrated transport system,” added the official, requesting anonymity.

He further said that during the development of these Metro lines, innovative traffic diversion will be done. “People should not suffer because of the project. We will sit with the traffic department officials and do innovative traffic diversion, so that the Metro work can carry on smoothly,” he said.

India signs $650 Million Agreement with World Bank for Eastern DFC-III Project

401 km Ludhiana-Khurja section of the 1,840 km long Corridor will be built in this phase

dfc-eastern-corridorNew Delhi: Government of India has signed Guarantee agreement with the World Bank for IBRD direct lending of US$ 650 mn to the Dedicated Freight Corridor Corporation of India Ltd. (DFCCIL) for Eastern Dedicated Freight Corridor-III (EDFC-III) Project (a freight-only rail line) that will help faster and more efficient movement of raw materials and finished goods between the north and eastern parts of India. The project was approved by the World Bank Board on June 30, 2015.

The loan and guarantee agreement for the Eastern Dedicated Freight Corridor Project was signed by Raj Kumar, Joint Secretary, Department of Economic Affairs, Ministry of Finance, on behalf of the Government of India; M.K. Mittal, Director, Finance, Dedicated Freight Corridor Corporation(DFCCIL) and Hisham Abdo, Operations Manager and Acting Country Director, World Bank India, on behalf of the World Bank.

The objective of the EDFC-III Project is to augment rail transport capacity, improve service quality and enhance freight carriage throughput on the 401 km Ludhiana-Khurja section of the Eastern Dedicated Freight Corridor; and develop institutional capacity of DFCCIL to build, maintain and operate the entire DFC network.

This project is in continuation of Phase-I and II of the EDFC Projects being implemented by the DFCCIL with the World Bank loan of US$ 975 million and US$ 1100 million respectively on the Dadri-Khurja-Kanpur; and Kanpur-Mughal Sarai stretches of the Eastern Rail Corridor (Ludhiana-Delhi-Kolkata).

The project will directly benefit the power and heavy manufacturing industries of Northern and Eastern India, which rely on railway network for transportation of their material inputs and also for the distribution of bulk processed and semi-processed commodities and consumer goods. Railway passengers will also be benefitted through decongestion of the existing passenger lines.

The Eastern Corridor is 1,840 km long and extends from Ludhiana to Kolkata. The World Bank is supporting the Eastern Dedicated Freight Corridor (EDFC) as a series of projects in which the three sections with a total route length of 1,193 km will be delivered sequentially, but with considerable overlap in their construction schedules. EDFC 3, approved by the Board on June 30, 2016, will build the 401 km Ludhiana-Khurja section which goes through Punjab, Haryana and Uttar Pradesh. The project will help increase the capacity of these freight-only lines by raising the axle-load limit from 22.9 to 25 ton axle-load (upgradable to 32.5 ton axle loads) and enable speeds of up to 100 km/hr. The DFC lines are being built to carry bulk freight trains of 6,000 to 12,000 gross tons. The project is also developing the institutional capacity of the DFCCIL to build and maintain the DFC infrastructure network.

The objective of the EDFC project is to augment railway freight carrying capacity along the Railway Corridor between Ludhiana and Kolkata. The project will benefit industries of Northern and Eastern India, which rely on railway network for transportation of material inputs and exports that would accelerate creation of jobs in the northern and eastern regions of the country, said Raj Kumar, Joint Secretary, Department of Economic Affairs, Ministry of Finance.

The first loan of $975 million for the 343 km Khurja-Kanpur section in the EDFC program was approved by the World Bank Board in May 2011 and is already under implementation. The project has already awarded contracts worth Rs 5500 crore. The second loan of $1.1 billion for the 402 km Kanpur-Mughalsarai section was approved by the World Bank Board in April 2014 and is in the implementation phase. The major contracts for civil works and systems has been awarded with a total value of Rs, 6300 crore.

Implementing the Dedicated Freight Corridor program will provide India the opportunity to create one of the world’s largest freight operations. The corridor, which will pass through states like Uttar Pradesh, will benefit from the new rail infrastructure, bringing jobs and much-needed development to some of India’s poorest regions, said Hisham Abdo, Operations Manager and Acting Country Director, World Bank India. Moving freight from road to rail will reduce the carbon footprint of freight, he added.

The EDFC is part of India’s first Dedicated Freight Corridor (DFC) initiative – being built on two main routes – the Western and the Eastern Corridors. These corridors will help India make a quantum leap in increasing the railways’ transportation capacity by building high-capacity, higher-speed dedicated freight corridors along the Golden Quadrilateral. Currently, the rail routes that form a Golden Quadrilateral connecting Delhi, Mumbai, Chennai and Kolkata, account for 16 percent of the railway network’s route length, but carry more than 60 percent of India’s total rail freight.

Augmenting its transport systems is a crucial element of India’s trillion-dollar infrastructure agenda. Since the 1990s, road transport has advanced more rapidly than the railways, and now accounts for about 65 percent of the freight market and 90 percent of the passenger market in India, and those shares are growing.

The Indian Railways urgently needs to add freight routes to meet the growing freight traffic in India, which is projected to increase more than 7 percent annually. These freight lines will wholly transform the capacity, productivity, and service performance of India’s busiest rail freight corridors. At completion, it will be able to more than double its capacity to carry freight, with faster transit times, being more reliable and at lower cost, said Ben L. J. Eijbergen, Program Leader, Economic Integration and the Task Team Leader for the Project.

Significant Green Impact: In addition to the efficiency improvement and other operational benefits, the project is expected to bring in significant reductions in Green House Gas (GHG) emissions.

A Green House Gas Emission Analysis was conducted by DFCCIL for the Eastern DFC Project. The analysis shows that the Eastern corridor is expected to generate about 10.48 million tons of GHG emissions up to 2041-42, as against 23.29 million of GHG emissions in the absence of EDFC – a 55 percent reduction in GHG emissions.

Economic opportunities are also being explored along the freight corridor. The government is planning to set up integrated manufacturing clusters using EDFC as the backbone. These clusters will be set up with an investment of about $1 billion on either side of EDFC.

The loan, from the International Bank for Reconstruction and Development (IBRD), has a 7-year grace period, and a maturity of 22 years.

Deloitte, RITES to conduct feasibility study of Chennai MRTS integration

chennai-mrtsChennai: Leading consultants such as Deloitte, Rites Ltd, TUV SUD and Balaji Railroad Systems Ltd have evinced interest in preparing a feasibility study to integrate Mass Rapid Transit System (MRTS) operated by the Southern Railway and Chennai Metro Rail Ltd (CMRL) that comes under the purview of the State government.

These companies had participated in a pre-bid meeting to appoint the consultant held recently, said sources.

In a memorandum to Prime Minister Narendra Modi in August last, Chief Minister J Jayalalithaa had said the integration is desirable and feasible as MRTS has been substantially funded by the State government. The integration would enable effective synergies between various modes of public transport and increase share of public transport, she had said.

Aid from Japan agency

CMRL is a joint venture of the Centre and the Tamil Nadu government to construct Metro Rail Project Phase I in Chennai with loan assistance from Japan International Cooperation Agency. Chennai Metro weaves through the bustling commercial and residential areas of the city.

The first phase consists of two corridors of total length 45 km.

The first corridor stretches from Washermanpet to Chennai Airport and the second from Chennai Central to St Thomas Mount.

Construction work

The construction work in different sections of phase-1 of this project is in progress. CMRL has been operational from Koyambedu to Alandur since June 29, 2015. This was extended to Airport recently.

The 19-km line of the Chennai MRTS extends from Chennai Beach to Velachery . A 5-km extension of the line from Velachery to St. Thomas Mount is under construction. On its part, Southern Railway (SR) gave a Terms of Reference to CMRL for the integration. The CMRL was authorised to appoint the consultant, sources in Southern Railway said.

The consultant should deal with various assets pertaining to the departments of engineering, electrical, signal and telecommunication, track works, including formation/ overhead structures, stations.

This would be required to be handed over to CMRL for operation and maintenance.

The ownership of the assets may also be required to be transferred to CMRL.

Railways offers investment-friendly environment for Investors

Government of India invites private sector to invest in rail infrastructure – said Rajen Gohain, Minister of State for Railways, at ASSOCHAM International Summit on Invest Rail held at New Delhi. The Minister said that Indian Railways had already set in consultative process on private investment.

rajen-gohain-at-assochamNew Delhi: Railways is keen to involve private players in development of rail infrastructure at more than 400 major stations in the country and offers “favourable” investment environment for the industry partners, Minister of State for Railways Rajen Gohain said here today.  The Minister on Wednesday urged the private sector to invest in railway infrastructure.

“Need of the hour in Indian Railways is the massive investment and new technology without which we cannot move to become a world class transporter,” Rajen Gohain said at an industry summit organised here. “Thus, the plan is to increase investment to nearly one trillion rupees in the next decade,” the minister said at ‘ASSOCHAM International Summit on Invest Rail’. “We are ready to offer an attractive and investment friendly environment, particularly looking at investment partners in more than 400 station building projects for high return on investment,” he said here at an event organised by industry body Assocham.

Gohain said the railways will have to move from merely developing rail infrastructure to other support services like technology upgrade, better logistic support and better passenger services in an integrated manner.

Stressing on the need of heavy infusion of funds in rail sector, Gohain said “Need of the hour in Indian Railways is massive investment and introduction of new technology, without which we cannot move to become a world class transporter. Thus, the plan is to increase investment to nearly Rs one trillion in the next decade.”

He said development of rail infrastructure will help reducing pollution.

“Investment in rail will thus help in the planets sustainable and environmental goals and help in meeting the greenhouse gas emission targets. In addition, rail offers a more stable and sustainable form of transportation. We, in Indian Railways, are thus trying to have a collaborative approach in bringing governments, local authorities, railways and other stakeholders on the same wave length for a more sustainable form of transport system,” Gohain said.

While India has the world’s fourth largest rail network, as it has been outstripped by china, which now has more than six times as much railway track following an intensive expansion and modernisation of its network over the past two decades.

Logistic Hubs near Ports to boost exports; Commerce Ministry engage with IR to cut costs

Centre to build logistic hubs near ports to boost exports: Nirmala Sitharaman

Sunil Kanoria, President, ASSOCHAM chit chatting with Hon`ble Minister of State (IC) for Commerce & Industry, Smt. Nirmala Sitharaman
Sunil Kanoria, President, ASSOCHAM chit chatting with Hon`ble Minister of State (IC) for Commerce & Industry, Smt. Nirmala Sitharaman

New Delhi: The government is establishing logistic hubs near sea ports with private sector participation to relieve the issue of receiving stocks on the airport, seaport and movement of goods inland, according to Nirmala Sitharaman, Commerce Minister.

Speaking at an ASSOCHAM conference on ‘Strategies for Double Digit Growth in Exports in New Delhi on Friday, she said, “We are establishing logistic hubs nearer the sea ports, as many of them, I may not be able to give a final picture, I think this would address immediate concerns that would be sustainable in the long term.”

Highlighting the priority of the government to cut down on logistic challenges, she informed that the Centre was trying to make electronic data interchanges at major ports that are completely under the control of Central Government. “In 36 landing areas, the regional authorities representing the DGFT (Director General of Foreign Trade) office have just initiated a two-day intensive workshop with them to see how best to reach out to exporters, how best to engage with exporters and CBEC (Central Board of Excise and Customs) is also part of this exercise,” said the Minister.

Highlighting that a complete, comprehensive picture is being handled on the logistics front, she stated that her ministry was engaging with railways to cut down costs.

Informing that the government was currently reviewing the Foreign Trade Policy (FTP), Nirmala Sitharaman said, “As of 2015 when FTP was brought out I remember making a clear statement so that there is a sense of stability in the minds of exporters that I will not review the policy unless we reach the mid-term, the review has commenced. We are doing the FTP review.”

On ease of doing business, she said that government was identifying more and more hurdles each year without which exporters, manufacturers would be better off.

“We are working on it, it is something which is not going to be that easily brought to a closure, these are long term sustained efforts, which are not the glamorous side of big ticket reforms but the sustainable actions that we need to take in order to bring systemic reforms and we are at it,” said Nirmala Sitharaman.

IR has $65Bn of pending projects due to execution delays: PhillipCapital India Report

Half of Indian Railways’ pending projects are under construction for more than six years, leading to cost overruns, says a PhillipCapital India Pvt. Ltd report.

phillipcapital-on-irMumbai: Indian Railways has as much as $65 billion worth of pending projects with almost half of them being under construction for more than six years, leading to cost-escalations and making many of them un-bankable, PhillipCapital India Pvt. Ltd wrote in a 7 October report.

Of these 83% are construction related—new lines, doubling and gauge conversion—while the rest are related to road safety, signalling and telecom, and investments in production workshops and metro projects. About 61% of the total construction related projects are becoming un-bankable, the PhillipCapital report said.

“If IR were to execute its $65 billion of pending projects, it would have to take away four years of its budget (on FY17 base of Rs.1,200 billion), leaving no room for new projects. However, due to its prioritisation, we believe it can now award Rs.2,500 billion ($37 billion) of new projects over FY17-20, which otherwise would not have been possible,” the report said.

Execution delays, so far, have largely been on account of new line projects due to the challenge of land acquisition. This has made Indian Railways focus on prioritising execution of network decongestion projects and road safety works, “as these projects are more bankable and do not face issues such as land acquisition”, the report said.

Indian Railways, world’s fourth largest railroad, is looking to invest in high-speed trains and laying new tracks. It is working to get speedy approvals for its projects and turning execution faster. It is also in the process of adopting new train technology that can run up to a speed of 500 km per hour.

Several global companies like Hyperloop Technologies Inc., Spain’s Talgo SA, Germany’s Siemens AG and Knorr Bremse AG, are trying to woo Indian policymakers with their technologies for Indian Railways.

Indian Railways would need about Rs.3,894 billion or $53 billion to execute pending projects and network decongestion orders over FY17-20, according to PhillipCapital. Of this, 30% of the funds are expected to be met through budgetary support (GBS), 38% through loan funds (Life Insurance Corp. of India), 20% from internal resources (depreciation, safety and development funds), and the balance through Indian Railway Finance Corp (IRFC).

Ordering activity from Indian Railways is expected to rise this year. This will be a positive for companies, including Larsen and Toubro Ltd (L&T), Bharat Heavy Electricals Ltd (BHEL), KEC International Ltd, Crompton Greaves Ltd, Siemens India, Timken India, Kalpataru Power Transmission Ltd, Titagarh Wagons Ltd, Texmaco Rail and Engineering Ltd and others.

IR plans to revamp its Mobile Apps; Plans for robust Mobile Platform

Ernst & Young drafted this proposal for Indian Railways!

indian-railways-mobile-appA seamless travel experience for rail commuters with a swipe of a finger is in the offing as Railways plans to revamp its mobile application and include “all passenger services” for its customers.

“We are preparing an integrated mobile application for railway passengers which will take care of all their needs.”

It will be an app that will take care of the entire journey – from booking a ticket to booking a taxi, pre- ordering a meal, requesting for porter services, lodging at a retiring room, ordering a bed roll, complaining about lack of cleanliness in a coach, accessing digital entertainment, reserving a hotel, booking an airline ticket in case of a waitlisted rail ticket, among other services,”said an official from the Non-Fare Directorate of the Railway Ministry.

Ernst and Young, which has drafted this proposal for the Railways, intends to enhance the application in three stages by the end of which it plans to provide access to medical facilities, connect a passenger to police in case of an emergency and even assist with parking at railway stations.

It is expected that this initiative, which is part of railways’ move to monetise its digital assets, will fetch up to Rs 500 crores annually.

The Railway Ministry hopes that in this manner it will be able to augment its “non-fare revenue”, which is less than 5 per cent of the total revenue earned by it.

Railway Minister Suresh Prabhu in his budget speech earlier this year had envisaged raising this to at least 10-20 per cent by monetising soft assets.

ADB approves largest ever Railway financing package in Bangladesh

adb-bangladesh-railwaysDhaka: The Asian Development Bank approved its largest ever railway investment and its biggest investment in Bangladesh on September 28, a US$1·5bn loan package to finance the construction of a 102 km railway line which will link the tourist town of Cox’s Bazar with the existing network at Dohazari.

Construction of the 1 676/1 000 mm dual gauge line is expected to cost a total of US$2·012bn. The government is to provide US$512m on top of the four-tranche ADB financing, and a further $1m in technical assistance to help Bangladesh Railway with safety awareness and procurement. The government is also rehabilitating the existing 47 km Chittagong – Dohazari line under a separate project.

ADB said the nine new stations would provide links to other transport modes, and would be designed with the needs of the elderly, women, children and people with disabilities in mind.

ADB expects high demand from the 2·2 million people living in the Cox’s Bazar district. Special trains would run from Dhaka to support an expected 5% annual increase in the 1·9 million tourists who visit the town’s beaches every year.

Under a second phase, ADB expects to enhance the capacity of the future rail line and finance extensions to the Myanmar border and a planned deep-sea port on Matarbari Island, north of Cox’s Bazar. Converting the Dhaka – Chittagong line to dual gauge is to be financed under another ADB project.

The project forms part of the United Nations Economic & Social Commission for Asia & the Pacific’s Trans-Asia Railway network, and is intended to improve access to Myanmar and beyond.

The new line is one of a number of projects on the Dhaka – Chittagong – Cox’s Bazar and Dhaka – Khulna corridors which ADB and other partners are supporting to help Bangladesh meet its targets under its seventh five year plan and railway master plan. The overall aim is to increase BR’s market share from around 4% at present to 15% for freight and 10% for passenger traffic.

IIMB suggests Rs.15 as minimum fare for Namma Metro

Bangalore: The Indian Institute of Management Bangalore (IIMB), the consultant appointed to prepare a fare structure for Kochi metro, has suggested Rs.15 as the minimum fare for 2 km distance and Rs.65 for the 25-km-long Aluva-Pettah corridor, during peak hours.

The IIMB has also recommended variable fare during off-peak hours, capping the upper fare at Rs.50. The final fares will be fixed most likely at the next director board meeting of KMRL, after being vetted by the fare-fixation committee which would have representatives of the State government and the Union Urban Development Ministry, Kochi metro sources said.

The minimum fare suggested is higher than that for other metros in the country. The maximum fare for a 10-km-long journey in Mumbai metro is Rs.100, while Chennai metro charges Rs.40 for the same distance. The fare suggested for the same distance in Kochi metro is Rs.30.

The IIM team has submitted a report on fare projection till 2025. It has suggested a new fare stage for 2, 5, 10, 15 and 20 km.

Reacting to possible criticism of the suggested fare structure, vis a vis the fares of Delhi metro, KMRL sources said that the capital city charges a minimum fare of Rs.8 and Rs.16 for 10 km (Rs.1.50 per km) as compared to Rs.2.50 per km for travelling the full distance in the Kochi metro corridor.

The fares for Delhi metro’s first phase has not been revised so far, though a revision was expected in 2011.

Focus on TOD

Reacting to the suggested fare structure, D. Dhanuraj, chairman of city-based Centre for Public Policy Research (CPPR), warned that high fares might result in low patronage for the metro. “The focus must be on transit-oriented development (TOD) along the Aluva-Pettah metro corridor. Hong Kong is an apt example of a metro system which has optimally tapped the TOD concept,” he said.

In Kochi, government land in possession of the Kochi Corporation, Revenue Department etc. on the metro corridor can be better utilised, raking in revenue for the metro. Only then can the metro be operated in a feasible way, Mr. Dhanuraj said.

Rail Ministry signs MoU with CII

Memorandum of Understanding (MoU) signed between Ministry of Railways and Confederation of Indian Industry (CII) on Green Industrial Units. Minister of Railways e-Releases “Final Report on the Passenger Feedback Survey at major Railway Stations for Cleanliness Ranking.”

The Union Minister for Railways, Shri Suresh Prabhakar Prabhu witnessing the signing of an MoU between Ministry of Railways and Confederation of Indian Industry (CII) on Green Industrial Units, in New Delhi on July 26, 2016. The Minister of State for Communications (Independent Charge) and Railways, Shri Manoj Sinha, the Minister of State for Railways, Shri Rajen Gohain, the Chairman, Railway Board, Shri A.K. Mital and other dignitaries are also seen.
The Union Minister for Railways, Shri Suresh Prabhakar Prabhu witnessing the signing of an MoU between Ministry of Railways and Confederation of Indian Industry (CII) on Green Industrial Units, in New Delhi on July 26, 2016. The Minister of State for Communications (Independent Charge) and Railways, Shri Manoj Sinha, the Minister of State for Railways, Shri Rajen Gohain, the Chairman, Railway Board, Shri A.K. Mital and other dignitaries are also seen.

Hyderabad: The Railway Ministry today signed a memorandum of understanding with Confederation of Indian Industry (CII) for evaluating the green initiatives and rate the performance of its industrial units pursuing environmentally sustainable practices.

Talking about the tie-up with CII, Railway Minister Suresh Prabhu said at the event, “Now, we are not just compliant with our own good standards but will be compliant with global standards.”

The MoU was signed for Green Business Centre (GBC) of CII to extend technical co-operation for various green initiatives.

It has developed a GreenCo Rating system to evaluate the various steps and rate them. GBC will also assess and certify 3 industrial units of the Railways and organise studies on energy efficiency.

In the august presence of Minister of Railways Shri Suresh Prabhakar Prabhu, a Memorandum of Understanding (MoU) between Ministry of Railways and Confederation of Indian Industry (CII) to evaluate the Green Initiatives and rate the performance of Industrial Units of Indian Railways which are pursuing environmentally sustainable practices, was signed and “Final Report on the Passenger Feedback Survey at major Railway Stations for Cleanliness Ranking” was E-Released today i.e. on 26.07.2016.   Minister of State for Railways & Minister of State (Independent Charge) for Communication Shri Manoj Sinha and Minister of State for Railways Shri Rajen Gohain was present to grace the occasion. On the event of Signing Ceremony, Chairman Railway Board Shri A. K. Mital, Member Mechanical ShriHemant Kumar, and other Board Members and Senior Officials were present. On behalf of the Railway Ministry Smt.Kalyani Chadda, EDME(W) signed the MoU whereas on behalf of CII Shri S. Raghupathy, Dy. Director General, CII signed the MoU. The MoU was signed in the backdrop of Railway Minister’s Budget announcement.

Speaking on the occasion, Shri Suresh Prabhu pointed out that notwithstanding the fact that Railways is an environment friendly transport, multi pronged green initiatives are being taken by Indian Railways. This includes the share of renewable in energy consumed, better Water Management including Water Audit, Solid Waste Management including Waste to Energy plants etc. The association with CII will enable Railways to weigh their green initiatives against the global standards.

The partnership with CII has come in the right time when Railways are in the change mode for a sustainable growth. Indian Railways have been playing a key role in every aspect of Government’s initiatives. The provision of bio toilets in a large scale to avoid open discharge from the coaches is a major step towards this. Recently, the Manmadurai –Rameshwaram section of Southern Railway was declared as a first green railway section. Indian Railways have so far provided more than 40,000 bio toilets. During this year, another 30,000 bio toilets are proposed to be added. The unique effort of bio vacuum toilets by Indian Railways will be a big game changer in this regard if the trials prove successful.

Speaking on the occasion, Shri Manoj Sinha said that Railways which has its production units in almost all parts of the country should ensure some environment friendly measures like solar energy, energy audit, water harvesting. He said that keeping in mind all these measures, today’s MoU has been signed so that environment friendly measures could be taken.

Speaking on the occasion, Minister of State for Railways Shri Rajen Gohain said that Railways being the biggest industry of the country is conscious towards the environment friendly measures and these measures could bring drastic change after implementation.

The MOU has been signed for GBC-CII to extend technical co-operation for various Green initiatives in 3 Railway’s Industrial establishments, with an objective to make Indian Railways, as a leading Government organisation in the field ofEnvironment.Initially following two programmes will be taken up under this MOU:

  • Green Rating for Railway Industrial units – In the first phase – Diesel Locomotive Works (DLW)/Varanasi Integral Coach Factory (ICF), Chennaiand Carriage & Wagon Workshop, Perambur /Chennai, Southern Railway, have been selected for thisimportant initiative.All the Green initiatives of these units will be rated on a common Platform applicable to all the industries. Based on the experience remaining Units will be taken up under this scheme.
  • Energy Efficiency studies at 6 Production Units and 4 major workshops over Indian Railways. This will include Capacity Building, Knowledge sharing and exchange of best practices on Energy efficiency between Railways and other industrial sectors.

ICAI confident of Railways likely to adopt Double-entry Accounting

Double Entry Accounting SystemVijayawada: The Institute of Chartered Accountants of India (ICAI) is confident that the Indian Railways will start implementing Double Entry Accounting System (DEAS) from 2017 thereby facilitating better management of its finances and assets.

The institute will be submitting the report of a pilot project done by it on DEAS in the Jaipur division to the Ministries concerned in August. The proposed adoption of a similar accounting system by the Ministry of Defence is being closely followed and the official nod for it is likely to be given next year, said ICAI national president M. Devaraja Reddy.

Addressing a press conference here on Saturday, Mr. Devaraja Reddy said the Ministry of Railways (MOR) had acknowledged the effectiveness of the accounting system mooted by the ICAI Accounting Research Foundation. The MOR was expected to give the green signal soon, facilitating regular auditing of railway establishments across the country in tune with the new accounting norms. Mr. Devaraja Reddy said the ICAI was firm on its stand that constitution of a National Financial Reporting Authority (NFRA), for which a provision had been made under Sec. 132 of the Companies Act, 2013, amounted to encroaching on the powers of ICAI.

Main areas of the topic include traffic revenue, balance-sheet accrual system, and fixed assets. By making a move to the institute, the chief purpose of the Indian Railways was to the convince the same for undertaking the tentative project on the study of current budgeting and the costing system. They wanted the institute to come up with a proposed plan for the outcome budgeting and the integrated cost accounting framework in agreement with the 2016 Union Budget. “Railways has got vast assets across the country and huge manpower. Hence, the double accounting system will help them to know how to manage those assets and manpower in a cost-effective manner,” told by ICAI President M Devaraja Reddy. The institute has recently undertaken a pilot study project of review of the capital expenditure procurement process and policy compliances framework on pro-bono basis of another state-owned PSU, Coal India” he said. Further, he added that a project on ‘migration strategy for implementation of accrual accounting system in EPFO’ has also been considered by ICAI and it has submitted the draft reports already.

The Quality Review Board (QRB) formed under Sec. 28A of the Chartered Accountants Act, 1949 was striving to ensure the quality of services rendered by the accounting professionals.

“The QRB and NFRA are bound to work at cross-purposes while the Ministry of Finance claims that the latter will be an overarching authority dealing with larger issues beyond accounting,” Mr. Reddy observed. Mr. Devaraja Reddy said efforts were being made to implement new syllabus from November. It was approved by the Ministry of Corporate Affairs and the clearance of Ministry of Law and Justice was awaited.

Speaking at ICAI’s sub-regional conference earlier in the day, Mr. Devaraja Reddy said there were 2.60 lakh chartered accountants in the country. Of them 1.10 lakh are doing independent practice and the others were employed in the corporate sector.

The ICAI has requested Chief Minister N. Chandrababu Naidu to allot five acres to the institute in Amaravati for setting up a Centre of Excellence there.

It will focus on skill development and continuing professional education.

Platforms heights will be raised: MRVC

Mumbai: The Mumbai Rail Vikas Corporation (MRVC) has assured the World Bank that platform heights of all the stations would soon be raised.

The MRVC has given its update to World Bank, which is one of the biggest lenders for Mumbai-related railway projects. The WB has been asking the body to pull up its socks for the protection of passengers. As a measure to reassure the lender, MRVC has assured that platforms of all the stations will soon be raised.

The WB has asked the Railways about why those sections of the communities like women, senior citizens and differently abled have been overlooked. “We have told the WB that we will be raising the platform to a height of the footboard of the train. Although we are not directly responsible for this, we will work with both the Central and the Western Railway to improve the situation,” said a railway official.

Both the Central and Western Railway have been trying to complete the work of raising of the platform since the incident of Monica More who had lost both her arms when she fell between on the track in 2014. MRVC has already been rapped on the knuckles by the WB for not doing enough to decrease the number of deaths on railway tracks. The MRVC has recently approached the WB for Mumbai Urban Transport Project (III) and will be repaying the loan until 2050

World Bank team to take stock of MUTP-II & III in the first week of August

World Bank MUTPMumbai: The World Bank (WB) will visit Mumbai railway offices to take stock of the Mumbai Urban Transport Project II and III in the first week of August.

This visit is being regarded as important since the WB has rapped city railway officials on the knuckles on at least two previous occasions for not doing enough to curb the number of deaths caused by railway accidents, especially people falling off the trains, and while crossing the tracks.

The WB has also asked the railways to do more to improve women safety on the trains.

The railways has taken a loan of 309 US million dollars for MUTP II cost of Rs 4,713 crore which includes works like trespass control and the remaining 24 out of the 72 new rakes that are to be delivered until December of this year. MUTP III on the other hand has finally been priced at Rs 11,000 crore project cost, and has been agreed upon to be repaid at a seven per cent interest until 2038.

“The WB will basically be shown the completed work under MUTP II like the conversion of Harbour from direct current to alternate current and increasing it’s capacity from nine to 12-coach,” said an official.

The WB has also asked the city railway officials to bring forward more solutions to curb the deaths and will be presented the Western Railway’s (WR) proposal to fix automatic closed-door in 22 coaches. The officials will also be briefed about the current status of the trespass control, a major problem.

Bullet Train project drags Indian Railways into 21st Century

Under Suresh Prabhakar Prabhu, the Indian Railways appears to have come out of the rut

India may spend as much as $16 billion – over $1 billion more than initially estimated – on the nation’s first bullet train to elevate the entire railroad, a person with direct knowledge of the matter said.

Land acquisition hurdles, as well as people and animals potentially wandering in front of carriages speeding at 350 kilometers (217 miles) an hour, make the option of an elevated link attractive, the person said, asking not to be identified as the plans are private. Construction starts in 2018, the person said.

India is working with Japan to build the 508 kilometer high-speed track from financial capital Mumbai to the economic hub of Ahmedabad in Prime Minister Narendra Modi’s home state of Gujarat. A Japanese-designed Shinkansen train will connect the cities in a project initially estimated to cost 980 billion rupees ($14.6 billion), one of India’s biggest infrastructure endeavors.

Modi’s government is keen to elevate the entire railroad – at an extra cost of about 78 billion rupees – and operate the train from 2023, the person said. A dozen stations are planned and 2,000 jobs may be created in a project officials expect to spur economic growth, the person said.

IR in fastrackA bullet train would help drag the world’s fourth-largest railroad into the 21st century. The network carries about as many passengers daily as Australia’s population, but is both congested and aging, with roots dating back to British colonial rule. Modi is seeking to spend 8.5 trillion rupees through 2020 on new tracks, trains and stations.

For more on Indian Railways’ goal of a $126 billion overhaul, click here.

The challenge is to execute the bullet train project on time, said Gaurang Shah, Vice President at Geojit BNP Paribas Financial Services Ltd. Success would help improve the railway’s image, which has been battered by years of losses despite government investments, he said.

A $16 billion outlay would be close to 1 percent of India’s $2 trillion gross domestic product, which is already expanding at the fastest pace among major economies. Japan has offered to fund 81 percent of the initial project cost with a 50-year loan at a 0.1 percent interest rate.

A state company is being set up for implementation, and at least half the spending will probably go to local contractors such as Larsen & Toubro Ltd., Gammon India Ltd. and GMR Infrastructure Ltd. for track and stations, the person added.

Anil Kumar Saxena, an Indian Railways spokesman, didn’t immediately respond to an e-mail seeking comment.

Japan pioneered bullet trains, debuting them in time for the 1964 Tokyo Olympic Games. Since then, roughly 5.6 billion passengers have used the Tokaido Shinkansen, which links Japan’s three largest metropolitan areas of Tokyo, Nagoya and Osaka, according to the Central Japan Railway Co.

About 15 billion rupees of the project will go to Japan for elements such as train design and signaling, the person said. India wants local train manufacturing, but one challenge is that companies may be reluctant to set up plants with Japanese partners without a pipeline of similar future projects, the person said.

India has a mixed record on railway infrastructure projects. A plan to add 3,360 kilometers of track dedicated to cargo trains, first announced in 2005, still hasn’t been completed, with 14 percent of the land needed yet to acquired. In contrast, the 213-kilometer New Delhi-metro system is seen as defying perceptions that India’s infrastructure projects are graft-addled and routinely exceed cost estimates.
IR in fastrack2

‘Start Somewhere’

While Modi has described the bullet train project as historic, opponents question the plan, arguing fares will be beyond the reach of many in a country where most people live on less than $3.10 per day. The money could be used on basic needs such as housing for the poor, according to main opposition Congress party.

A survey of the railroad’s route is under way and will be used for the design of the link, the person said. The credit agreement with Japan for the long-term loan is due to be finalized this year, the person added.

“What you have to crack is the ability to replicate this technology – to develop the capability in our country to do this in-house,” said Rajaji Meshram, a Director of Infrastructure and Government services at KMPG in New Delhi. “We have to start somewhere.”

Under Suresh Prabhakar Prabhu, the Indian Railways appears to have come out of the rut, and overcome its earlier state of acute financial stress, with Rs 5 lakh crores worth of projects stuck. Taking charge at Rail Bhavan six months after the Narendra Modi government came to office, this chartered accountant quickly demonstrated why he is known as a man of reforms. The first minister to take charge of the Railways in the Modi government was D.V. Sadananda Gowda, but he too failed to bring any effective solutions. The change started soon after Mr Prabhu took over in November 2014.

To address the Railways’ immediate requirements, Mr Prabhu sought to find funding sources outside the normal Gross Budgetary Support. “Even the money the finance ministry provides through GBS is sourced from debt financing. Why should not the Railways go to the market and get the money,” he asked while presenting his first Rail Budget.

He soon got a Rs 1.5 lakh crore soft loan from LIC, and began to meet the heads of financial institutions to urge them to lend to private firms working on rail projects. The effect of this was quickly visible: the Railways commissioned 2,828 km of new lines, doubled broad gauge conversion in the last financial year. This was four times the annual average in 2009-14. “Earlier we had no assured funding, and thus projects were not taken up for commissioning with deadlines. Now we know the funds are there and the race is to expedite commissioning. In the current financial year we will commission 2,900 km of new tracks, that will be 4,500 km in 2017-18 and 7,000 km in 2018-19,” said V.K. Gupta, member (engineering) at the Railway Board.

The twin dedicated freight corridors linking Dadri-Mumbai and Ludhiana-Dankuni (Kolkata) have seen a major push and Mr Prabhu has said they will be commissioned in 2018. The minister thus appears logical when he promised he will double the speed of passenger and freight trains in the next four years, besides ensuring tickets on demand.

But what really brought about a remarkable change in public perception about the Railways is the effectiveness of the real-time grievance redressal system Mr Prabhu set up, that will now be studied by IIM Ahmedabad.

“I initially used to use Twitter and respond to distress messages by passengers. (As) the volume of messages shot up, I made it mandatory for all general managers and divisional railway managers to use Twitter and connect with passengers. They put in place systems to respond to the passengers’ distress messages,” said Mr Prabhu, who added that the Railway Board has also put in place an elaborate cell for this purpose.

IIM-A will study Railway Minister’s Twitter strategy and Social Psychology of Rail Passengers

The way in which Ministry of Railways, under Suresh Prabhu, has been successful in utilising a social media platform like Twitter to redress railway passengers’ complaints in real time, will soon become part of the curriculum at the Indian Institute of Management (IIM), Ahmedabad.

The Ministry of Railways has become a role model for other ministries on how a social media platform can be used to reach out to customers in real time rather than just using it as a platform to indulge in a public relations exercise.

Professor Sunil Maheswari, who teaches Human Resources in IIM(A) and has taken up the study on the use of Twitter by the Ministry of Railways, told that he was inspired to study the subject after reading media reports on how passengers’ grievances were being solved through Twitter.

“Indian Railways is a huge organisation with over 14 lakh employees and so many divisions across different states. The primary focus of this study is how one single tool (Twitter) is being used internally by the railways to disseminate information and how, on the basis of one tweet by a passenger, railway officials across the country get active. I want to study how the whole operation is planned and executed and how a quick response is solicited from the railway officials concerned to help the railway passenger,” Maheswari said.

Professor Maheswari has already started interacting with the stakeholders of this study.

“Work has already started on this, but it will take some time. The study will be part of the curriculum that we are going to teach the students. We are doing this for a purely academic purpose. It is going to be a long process and it is serious research that we have undertaken. Since we are very sensitive about the accuracy of the data, once we are sure about the numbers, only then will they be introduced in the classes,” he said.

According to the professor, to get a complete idea of how things work, he will visit the Ministry of Railways and meet all the stakeholders, apart from meeting the officers in different divisions, zones, the Railway Board and also interact with users who have utilised Twitter to raise their problems.

“Using social media to communicate with passengers is a very innovative idea since they are connecting directly with the public and redressing their grievances in real time. They are also getting feedback from customers and stakeholders in real time which is very useful,” he said.

According to him, non-redressal of a complaint satisfactorily was a big challenge for the railways as it leads to extreme unhappiness if customers’ problems are not solved.

Last month, a railway passenger passed away in a moving train while travelling between Balia and Kolkata after he fell ill and despite numerous attempts by his relatives, who were travelling with him, to seek help from railway officials, he could not be provided with medical help.

Despite Prabhu pushing for quick responses to tweets sent by passengers, many senior officers are still reluctant to reply to tweets as this means an “increase in their responsibility and accountability”.

IR may soon get $500mil. World Bank loan for Stations Redevelopment project

Indian Railways World BankNew Delhi: After securing a soft loan from Japan to build India’s first bullet train project between Ahmedabad and Mumbai, the ministry of railways will soon wrap up a similar loan from the World Bank for $500 million with a moratorium on interest payments for seven years for the purpose of re-developing existing stations to world standards.

The rail ministry will also soon seek Cabinet approval to hand over three identified stations to largest public sector construction company NBCC to make them world class. The railways has short-listed eight stations for re-developing them to world-class standards, which include Habibganj (Lucknow), Bijwasan and Anand Vihar (Delhi), Chandigarh, Surat, Gandhinagar, Mohali and Shivaji Nagar (Mumbai).

“The ministry is in a final stage to rope in World Bank for a $500-million loan with a moratorium of seven years for undertaking the redevelopment of stations. This will be in addition to Ambala and Ludhiana for which the French Rail Corporation has been given the consultancy,” a senior official of the Railway Board said.

The ministry of railways is adopting various strategies for the re-development of stations to world-class status. Accordingly, a Cabinet note has been initiated to entrust three identified stations to the National Building Construction Corporation (NBCC) on nomination basis, added the official.

The ministry of railways would next month come out with a modal document approved by the Railway Board, which would be the basis for the private players to become part of the exercise for redevelopment of stations to world-class standard.

The Cabinet had last year approved a plan to develop 400 A1 and A category stations to the world class standard. The Railways has held consultations with a large number of construction companies, including L&T, Reliance, Tata, Sapoorji-Pollonji, Bharti, ATS for their views on the road-map for redevelopment of stations, said the official.

“After the Modal Document is made available to public in June, the zonal railways will begin inviting proposals from the private players to take part in the redevelopment exercise,” said the official. The Habibganj station (Lucknow) will be the first to be awarded to the private player for re-development. The Railways has constituted Indian Railway Station Development Corporation (IRSDC), which will be the nodal agency to execute the re-development of the station project to the world class status.

MUTP-III Funding: MRVC to Negotiate with World Bank on Terms & Conditions

Oppty JunctionMumbai: The third phase of the Mumbai Urban Transport Project (MUTP-III) appears to be slowly rolling ahead as the Mumbai Railway Vikas Corporation (MRVC) plans to soon begin negotiations with the World Bank on the terms and conditions for the loan.

MUTP-III received a token allocation of Rs.5 crore in this year’s railway budget. NITI Aayog, the central government’s advisory body, has given in-principle approval to the project on the condition that the railways will undertake fare reforms besides introducing cab-signaling technology on one suburban corridor.

A senior MRVC official said, “The Department of Economic Affairs under the Finance Ministry has given us the mandate to undertake negotiations. It will be atleast a year before the loan is disbursed.”

The MRVC is looking at obtaining 60-70% of the funding from the World Bank and the balance will be financed equally by the state government and the Ministry of Railways. Both, the MUTP-I and MUTP-II projects were also financed partially with loans from the World Bank.

MUTP-III includes Airoli-Kalwa rail link which aims to provide direct connectivity between Kalyan and Navi Mumbai and will enable the railways to run 40 services between Kalyan and Navi Mumbai. This project can be completed in less than a year as there are no major engineering challenges or land acquisition issues involved.

The project also includes quadrupling of the Virar-Dahanu corridor which will help segregate mail, express and suburban traffic, thus opening up the tracks to run more suburban trains.

Doubling of the Panvel-Karjat route will also be undertaken to enable more suburban services.

Apart from trespassing control project, MUTP-III will now also include cab-signaling on the Harbour line. This component of the project will cost Rs 4,082 crore. It might increase the current project cost of MUTP-III from Rs.10,000 crore to Rs.15,000 crore.

Based on the Harbour Line experience, the cab-signaling technology will then be extended to the main lines of Western Railway and Central Railway.

However, despite the spate of announcements by the Union Railway Minister Suresh Prabhu during his visit to the city last week, the ground reality remains that the next big project Mumbai Urban Transport Project III (MUTP) has remained unsanctioned till date. The railway ministry is yet to reply to Niti Aayog’s questions about the financial feasibility of the project, a question the Aayog had asked back in February 8 but the officials are stumped with the question and are yet to reply.

The Union railway minister had declared that the MUTP III project would be the next target of the ministry in Mumbai, in his budget speech in 2015. But when the Niti Aayog asked them how a system that runs into losses of up to Rs 1, 600 crore can afford MUTP III, the officials were left speechless. The initial estimates of MUTP III are an approximate Rs 10,000 crore and like its predecessors, MUTP I and II, it will be funded by the railway ministry while the other half will be a loan at an interest of seven per cent from the World Bank (WB).

It has been over two-and-a-half-months since the railways was asked to respond to that question. Commenting on the matter, a railway official said on the condition of anonymity, “The Aayog had asked us to do three things. The first is to approach the World Bank and ask it for a loan of Rs 7,000 crore since the railways has not done it yet, even though talks of MUTP III has been on for a decade. It has also asked the railways how it would work out the loan since running one 12-coach service cost the railways Rs 55 lakh per annum.”

The official said that the last condition put forth by Niti Aayog was that railways implement the Communication Based Train Control (CBTC) on either the Western or on any of the Central Railway’s lines. “It has been decided to run the CBTC on the Harbour line for experimental purposes but this decision too has not been officially put on paper,” said the official.

When asked about MUTP III, Suresh Prabhu had in his two-day visit to the city on April 21 and 22 he had said that work will happen ‘step-by-step’ and that these things ‘take time’.

Mumbai-Ahmedabad distance of 534 km ideal for High Speed Rail: IIM-Ahmedabad

Could give ‘significant edge’ over other modes like air, road and conventional rail

Based on international experience of other countries like Japan, France and China, a study by the Indian Institute of Management, Ahmedabad (IIM-A) has found that the 534 km distance between Mumbai and Ahmedabad could give the high speed rail (HSR) significant edge over air, road and conventional rail transport modes.

As per the study, international experience shows that the sweet spot for high speed rail is often viewed in the 300 to 600 km distance, where there would be a significant edge over air, road, with the possibility of same-day return, thus scoring over conventional rail too.

Titled ‘Dedicated High Speed Rail Network in India: Issues in Development’ and co-authored by G Raghuram and Prashanth D Udayakumar of IIM-A, the paper analyses the issues and challenges facing HSR in India even as it accepts the premise that the dedicated HSR is the way to go in the country.

India and Japan have signed a memorandum of understanding (MoU) to set up a high speed rail (HSR) network costing Rs 97,636 crore, between Mumbai and Ahmedabad, wherein Japan would fund $12 billion (about Rs 78,100 crore, providing for about 80% of the project cost) offering a concessional loan to India with a repayment period of 50 years including a moratorium of 15 years, at an interest rate of 0.1%. This segment for HSR implementation would be based on the Japanese Shinkansen technology.

The central government has formed High Speed Rail Corporation of India Limited (HSRC) as a special purpose vehicle (SPV) and a subsidiary of Rail Vikas Nigam Limited (RVNL), for the development and implementation of HSR projects.

Apart from the distance falling in the 300-600 km ideal category for HSR, the paper finds a second sweet spot in form of leveraging the preference for night travel in future for a 1,500-plus km distance of high speed night travel.

“Having night travel would conflict with the traditional concept of doing maintenance by night in the HSR. However, it may be possible to explore mid-day maintenance schedules, when there would be a slack in demand,” it suggests.

Analysing various options that lies ahead for the Indian Railways for HSR stations, the paper identifies three possibilities including existing railway stations at city centres, existing railway stations at the periphery of cities, or newly built railway stations at the periphery of cities.

While the option of existing railway stations at city centres is found to be an ideal choice form the point of view of the catchment, it argues that peripheral locations would cost lesser and pose fewer problems in terms of land acquisition. However, seamless intermodal connectivity to the city centre has been advised for good patronage of high speed rail. On the other hand, the option of existing railway stations at the periphery of cities would be preferred over newly built railway stations at the periphery, since local train services could be developed from the railway station in the periphery.

However, the paper also considers potential expansion of city and decongestion of central business district (CBD) as a long advantage for newly built railway stations located at the periphery of the cities.

In terms of tracks, the papers analyses that while having a HSR tracks at grade level would mean lower cost, the same would also entail major problems to be overcome such as land acquisitions and providing crossovers for roads and adequate protective fencing. The grade level tracks would also divide geographies, putting a cost on those who need access from one side of the alignment to the other.

On the hand, the paper finds that elevated tracks could greatly minimise the issues of land acquisition, road crossovers and fencing, though the same could be expensive compared to at-grade-level track option.

Highlighting the challenge of choosing the right gauge for the high speed rail project between Mumbai and Ahmedabad. the paper states that most countries with HSR use the standard gauge of 1435 mm, including countries like Japan and Spain where it is not the conventional gauge.  In India, the broad gauge of 1676 mm width has been the conventional gauge so far.

“Adopting broad gauge for HSR would ensure interoperability of the HSR rolling stock on conventional rail, potentially increasing the catchment for the HSR trains. This would of course raise the issue of whether conventional rolling stock should be permitted on the HSR route, especially if there is scope for increasing capacity utilisation. Adopting standard gauge would provide more scope for sourcing of rolling stock, through easy acquisition from other countries. Separation of service types by providing dedicated rights of way can improve reliability and capacity,” the paper observes.

It needs to be mentioned here that the pre-feasibility report for the Ahmedabad-Mumbai-Pune route had recommended an Indian broad gauge of 1676 mm ballastless track system, apart from a rolling stock with a 3300 mm wide car body, and a 350 kmph operation speed.

Railways suffered from under-investment, says ICAI, PHD joint study

IR infrastructure & investmentNew Delhi: A knowledge paper on the Indian Railways, prepared jointly by PHD Chamber of Commerce and Industry and Institute of Cost Accountants of India (ICAI) reveals that the public transporter suffered from under-investment between 1951 to 2014.

The paper said the track capacity addition of railways could grow at compound annual growth rate (CAGR) of a meager 0.7 per cent whereas it witnessed passenger and freight traffic growth of CAGR 3.1 per cent and 4.3 per cent respectively.

The paper titled ‘Indian Railways Transforming into an Engine of Growth’ states that “the resources have been insufficient for improving customer satisfaction and introducing technological improvements. Investments in safety have also been insufficient and the biggest challenge facing Indian Railways is its inability to meet the demands of its customers both freight and passenger.”

The paper released here by Union Minister of State for Development of North Eastern Region (DoNER) Jitendra Singh states that as a consequence, capacity augmentation has suffered and so the quality of service delivery.

According to the paper, due to low track km addition over the years, the high density networks of the Indian Railways are facing acute capacity constraints, 40 per cent of sections are running at 100 per cent or above line capacity showcasing the high congestion in the system.

More than 65 per cent of high density network is running at over 100 per cent utilization levels, the paper said.

It points out that Indian railways is equipped with train engines that can travel at a speed of 160 km per hour but due to old coach designs, the maximum speed they can travel at is 110 km per hour.

In India the main line tracks built cannot even sustain the trains travelling at a speed of 110-130 km per hour. Due to this, the average speed of the trains is hampered, it said adding that time required to travel is increased because of weak infrastructure.

The paper further highlights that while passenger segment utilizes 65 per cent of the resources, it contributes only 30 per cent to the revenues, whereas freight contributed 70 per cent but utilizes only 35 per cent of resources.

Cross subsidizing of passenger fares by artificially high freight fares has led to shift in favour of road transport, both in freight and short distance passenger traffic, it added.

Relates Posts: http://www.railnews.in/congress-responsible-for-railways-backwardness-railway-minister-suresh-prabhu/

Growth in Passenger & Freight Traffic will boost IT Spending in Railways thru’2020: Technavio

Technavio RailwaysTechnavio analysts forecast the global information technology (IT) spending in railways market to grow at a CAGR of close to 16% during the forecast period, according to their latest report.

The research study covers the present scenario and growth prospects of the global IT spending in railways market for 2016-2020. The report also presents the vendor landscape and a corresponding detailed analysis of the top five vendors operating in the market.

Technavio ICT analysts highlight the following four factors that are contributing to the growth of the global IT spending in railways market:

  • Need to improve efficiency and reduce cost
  • Growth in passenger and freight traffic
  • Enhance passenger experience
  • Need to improve overall security

Need to improve efficiency and reduce cost

Authorities worldwide seek innovative and cost-effective technologies to enhance railway networks and increase the overall capacity. Railway operators adopt solutions such as predictive analytics, rail traffic system, freight operations management, location tracking system, and video surveillance to improve railway infrastructure. The service development costs can be significantly reduced by a well-defined IT solution, which optimizes resource usage and automates the decision-making process for the higher management.

“The Norfolk Southern Railway in the US implements IT projects that focus on reducing the overall costs and improving overall operational productivity. Authorities have adopted a new dispatch and traffic control system to improve scheduling and transit time. Also, they plan to use tools that provide dynamic routing and optimize railcar-trip planning in a bid to improve the overall flow of the railways network,” says Amit Sharma, a lead analyst at Technavio for IT spending by region and industry.

Growth in passenger and freight traffic

The global railways passenger and freight traffic are growing due to plummeting oil prices and increase in industrial activities. Latest offerings (such as mobile ticketing) coupled with the rise in the use of personal computing devices (like smartphones and tablets) are boosting the railway passenger volume.

According to a report released by Amadeus, the long-distance railway passenger traffic in Europe is predicted to increase by more than 20% to reach 1.36 billion passengers by 2020. The rapid urbanization and growing awareness about environmental issues have led to a consistent increase in the number of railway stations and trains worldwide.

“International trade and emerging economies, such as Eastern Europe and India and China in APAC are expected to grow strongly and this, in turn, will boost the railway freight traffic,” says Amit.

Enhance passenger experience

Railway authorities are focusing on improving passenger experience to increase the number of commuters. They are implementing the latest technologies to improve passenger experience. The use of ICT improves access to information and leads to better services, attracting more commuters and freight deals. The real-time information system enables passenger inquiries such as arrival and departure schedules, the status of booked tickets, and availability of trains. The availability of these data can improve customer satisfaction levels.

The efficient use of ICT makes a difference in a wide and complicated railway network, such as India. Passenger ticketing and inquiry systems are highly service oriented and are developed to provide easy access to customers.

Need to improve overall security

Increase in the number of passengers and freight volumes have raised safety concerns. Many passengers have lost their lives due to communication lapse and technical glitches in the system. In February 2016, more than ten passengers lost their lives and more than 100 were injured when two trains collided in Bavaria, Germany, due to the communication lapse between trains.

A secure network with excellent communication systems is critical to ensure safety. Therefore, railways worldwide have started using high-capacity digital technologies such as IP-based networks and high bandwidth systems.

About Technavio

Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.

Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.

If you are interested in more information, please contact our media team at media@technavio.com.

View source version on businesswire.com:http://www.businesswire.com/news/home/20160411005489/en/

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Jesse Maida
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www.technavio.com

IR to achieve 75 per cent of 5-year CAPEX Target: Nomura

Nomura has predicted that Indian Railways would achieve 75% of its five-year (FY16-FY20) capex target of Rs.8.5 lakh crore and add 0.8 percentage points to India’s average GDP growth over the medium-term (5-8 years)

Nomura Global Markets ResearchNomura has predicted that Indian Railways would achieve 75% of its five-year (FY16-FY20) capex target of Rs.8.5 lakh crore and add 0.8 percentage points to India’s average GDP growth over the medium-term (5-8 years).

Stating the obvious in a recent report that chronic under-investment in the past decade has led to the railways reeling under severe capacity constraints resulting in severe congestion on its routes, the market research firm said the transporter was on the path to reverse the trend with its capex seeing a 70% jump over FY15 in FY16 and a further 21% increase in FY17.

Nomura claims that the transporter will be able to secure financing worth Rs.8.5 lakh crore through different routes. It predicts funding of Rs.2.56 lakh crore through gross budgetary support and Rs.1.5 lakh crore secured loan funding from the LIC.

Railways needs to go for Market-based Approach: Nomura

Nomura Global Markets ResearchNew Delhi: An international market research firm has suggested Indian Railways go for more market based approach, including phasing out of cross-subsidies between freight and passenger fares.

Japan-based Nomura Global Markets Research (NGMR), in its report, has been critical of inadequate investment in railways over the years which has resulted in severe capacity strains in the state-run transporter, affecting its services and making it uncompetitive.

The Ministry of Railways had commissioned Nomura to do a study on measures to re-invigorate the public transporter.

The research firm has observed that Railways is in “dire need of investments” and has given a thumbs up to Minister Suresh Prabhu’s approach in attracting investments.

“In our view, Railways’ multipronged strategy of plucking low-hanging fruit (prioritising and commissioning the vast backlog of projects, standardising and expediting project sanction to ensure robust project pipeline and facilitating time-bound execution, and accountability to enhance efficiency and focusing on bolstering its own finances, is potent enough for its reinvigoration,” the report said.

It has suggested that Indian Railways learn lessons and draw from experiences of other countries like United States, China and Japan to look for commercial or market based approach.

It has stressed that given the need to meet social objectives and in view of limited government resources in India, a mix of public and private funding models will likely be required.

“Political and social considerations have often dominated economic considerations, amplifying inefficiencies by cross- subsidising passenger services through higher freight rates.

“Over time, this has resulted in a vicious cycle of low investments and political interference, resulting in poor service quality and lower profits to plough back into investments. We believe to break this cycle, the government needs to step up investments in railway infrastructure,” says the Nomura report.

“We believe a much-needed paradigm shift in the investment and functioning of IR is underway, which bodes well for India’s economic growth,” the report said.

Partnerships are key to Indian Railways development: Suresh Prabhu

Railways Minister says he is getting good response from states on partnering for railway projects

Railways Minister Suresh Prabhu’s address at CII Annual Session
Railways Minister Suresh Prabhu’s address at CII Annual Session

New Delhi: Railway Minister Suresh Prabhu’s idea to partner with state governments for rail projects is making headway with the state governments that have signed pacts with the Centre making budgetary provisions for railway projects.

Recently the Maharashtra government has announced budgetary allocation for railways projects and the Haryana governor in his budget speech hinted of big railway investments.

Prabhu said he is getting good response from the states. “We have a comprehensive plan for transforming Indian Railways and we are trying to do this in the shortest possible time by involving multi-stakeholders,” Prabhu said while speaking at “Opportunities in Indian Railways—The scope for partnerships”at CII’s Annual Session 2016.

Elaborating on the challenge of providing a superior rail experience, rail minister emphasized on the need for exponential increase in capacity and continuous investments. He said that the government is making continuous efforts for partnerships as they are key to development of Indian Railways.

On the issue of financial viability, the minister stressed on the need for exploring various ways of augmenting non-rail revenue such as through monetizing of assets and redevelopment of stations. This will require involvement of private sector, multilateral organizations, non-government organisations, self-help groups and others in various areas of development.

“We are already in talks with the World Bank to form an international fund and many other investors are keen to join this. In fact, in this international fund, World Bank would be the anchoring this fund and it would help us to get funds for railways which has been in losses,” he said.

Nomura Global Markets urges IR to move towards a more Commercial Approach

Nomura Global Markets ResearchNew Delhi: A reputed international market research organisation has advised Indian Railways to move towards a more commercial approach including phasing out of cross-subsidies between freight and passenger fares, between commercial and non-commercial lines and services and rightsizing the employee base.

The Japan based Nomura Global Markets Research Institute in its report has pointed that given the need to meet social objectives and in view of limited Government resources in India, a mix of socialist (public funding) and capitalist (private funding) models will likely be required.

Suggesting that Indian Railways learn lessons and experiences of other countries like United States, China and Japan to look for commercial or market based approach, the research report has mentioned that the current Railway Minister (Suresh Prabhu) has proven to be more proactive with several developmental issues and Nomura’s recommendations already being implemented.

The report has sharply criticized the inadequate investment over many decades which has led to railways reeling under severe capacity strains, hampering its services and making it uncompetitive but simultaneously given thumbs up to Prabhu’s approach in attracting investments, which according to the Japanese marketing team, is in “dire need for investments”.

“Political and social considerations have often dominated the economic considerations, amplifying the inefficiencies by cross-subsidising passenger services through higher freight rates. Over time, this has resulted in a vicious cycle of low investments and political interference, resulting in poor service quality and lower profits to plough back into investments. We believe to break this cycle, the government needs to step up investments in railway infrastructure,” says the Nomura report.

The Ministry of Railways had commissioned the organistaion for a research report for measures to re-invigorate Indian Railways. Appreciating Prabhu, Nomura has said that with an apolitical and reformist Railway Minister at the helm, a roadmap to revive IR’s efficiency, financials and spending was clearly in the offing.

“In our view, profitability achieved through these changes would generate the necessary funds for gradual capacity expansion, raise the efficiency of railways as a mode of transport (for logistic companies), lower logistics costs and have a multiplier effect on boosting manufacturing competitiveness and GDP growth. The government would need to continue to play a key role in providing services on less profitable routes from a social perspective,” it said.

Talking about several committees and various expert groups formed to address the challenges faced by IR over past decades, Nomura has said that a lot of these committees have time and again highlighted steps to bail out the IR but action has rarely been taken. Talking about the latest Bibek Debroy Committee, Nomura has pointed that most of his recommendations is already been done and on the right tracks.

The Nomura Global Research team has also appreciated the government’s move to empower the zonal railways to carry out projects which is departure from earlier projects were scrutinised by the Planning Commission, Ministry of Finance and CCEA even when financed by private parties.

Further it has also compared the fact over the past three decades, India’s road network has tripled, whereas the railway network (ie, total track length in route km) has grown by just 11 percent.

Railways – Engine for Growth over the Next Decade: Religare

Religare has come out with its sector report on Capital Goods & Infrastrusture sector. According to the research firm,We believe IR has the potential to emerge as the next engine of growth in capital investments in India over the next decade!

Download Full Report Here: CapitalGoodsInfrastructure_PL

Railways Engine of GrowthMumbai: The central government has chosen railways as one of important driver for capital formation given the huge potential and multiplier impact it can have on the economy (~5x). Government has put together a plan to significantly step up investment in Indian Railways (IR).

It has planned an investment of over Rs 8.5 trillion over next five years, more than 3.5x over previous five years. In line with the plan, FY16 and FY17 saw allocation increase by 51% and 21% respectively.

In efforts to sustainably turn around railways, focus is not only on investment, but also other long term structural reforms to bring in efficiency, accountability and transparency. While investment plan might sound ambitions, sound financial plan makes it more reliable.

While putting mammoth organization like railways on track is a tall task, over the past one year many creditable steps have been taken which is expected to start bear fruits. We believe IR has the potential to emerge as the next engine of growth in capital investments in India over the next decade.

Railways to set up Special Wing of Scientists and Railway Experts

The new research unit will be headed by a reputed scientist, who will report directly to the Chairman, Railway Board, said a senior Railway Ministry official, adding “the need for such a wing was felt for long”.

Railways Centre of ExcellenceTechnology seems to be the latest mantra in the Indian Railway, with the national transporter set to create a special unit for conducting in-house research. Named SRESHTA (Special Railway Establishment for Strategic Technology and Holistic Advancement), the new entity will comprise mostly scientists and railway experts.

Research Design and Standards Organisation (RDSO), railways’ current research arm, will focus only on day-to-day issues, while SRESTHA will be responsible for long-term research for improving the functioning of the public sector behemoth.

The new research unit will be headed by a reputed scientist, who will report directly to the Chairman, Railway Board, said a senior Railway Ministry official, adding “the need for such a wing was felt for long”.

Though RDSO was meant to conduct research, it could hardly undertake any. “Most of the time RDSO is involved in finalising the standards and specifications for the new equipment to be acquired by the public transporter. As a result it is left with hardly any time for research work,” said the official.

Currently new technology is imported by railways as the RDSO has not been able to do in-house research work on various technologies required for upgradation in signalling and telecommunication system, track designing, improvement in rolling stock and many such areas.

However, despite the constraints, RDSO is credited for developing of pre-stressed concrete sleepers used for laying tracks and the newly designed double decker coaches.

The official said, “There is a huge requirement for introducing latest technology in rail sector to bring it at par with other developed railways in the world.”Use of latest technology in improving passenger amenities is a key area where the new body will focus, he added.

Besides, a dedicated cross functional team called Special Unit for Transportation Research and Analytics (SUTRA) would be set up for carrying out detailed analysis for optimal investment decisions and operations.

The team would comprise professional analysts and have best in class decision support systems and optimization engines. It is a well-established fact that data backed decision making is the hallmark of great institutions and SUTRA is being set up for this purpose only, the official said.

Skill India will provide Trained Workforce to Railways; says Skill Development Minister Rajiv Pratap Rudy

Rajiv Pratap Rudy in a seminarUnion Minister for Skill Development Rajiv Pratap Rudy on Thursday said the Skill India campaign will provide an efficient and trained workforce to the Indian Railways.

“Nine crore man-days employment by 2017-18 and 14 crore man-days by 2018-19 is a big opportunity for skilled workforce, that the Rail budget has presented on Thursday.

“Skill India will ensure maximum support in providing efficient and trained workforce for the railways in the country,” Rudy said.

FICCI’s ex-President Jyotsna Suri said the setting up of National Academy of Indian Railways and Centres of Excellence for Skill Development would help in creation of much-needed skills in the country.

Rail Minister willing to lead Investment Revival: ASSOCHAM

Sunil Kanoria, President, ASSOCHAM
Sunil Kanoria, President, ASSOCHAM

Railway Minister Suresh Prabhu has given a no-tariff hike budget without compromising on the capital expenditure for increasing carrying capacity, both passengers and freight even in a challenging economic environment marked by a severe slowdown in the commodity sectors, which are lifeline of the Railways’ earnings, ASSOCHAM President, Sunil Kanoria said.

While committing himself to improving the Railways in terms of better passenger amenities and adopting a service-provider approach to the industry, which is the main revenue customer for it, Prabhu has lived up to his reputation of being a financial wizard in banking on non-budget resources for funding the capital plans. He knows it too well, there are limited options through the Gross Budgetary Support.

Though there have been slippages in the revenue target in the current fiscal, it has got more to do with the overall economic slowdown, more so in sectors like coal, steel, iron ore etc which have been worst hit but have been the major revenue sources for the Railways. If every other sector of the economy and every other company is reporting tepid growth in earnings, the Railways cannot be expected to be an exception. In view of the continuing challenges, the 10 per cent growth projections on revenue targets of Rs 1,848.20 billion is realistic, although he is banking on revival of growth in the key sectors.

Likewise, the Plan allocation of Rs 1.21 lakh crore is laudable and given the fact that he is focusing on several innovative ways of funding, there is no reason to suspect he would not succeed. The project implementation would remain a key. The best thing is that he is willing to challenge the age old notion as if it is only through tariff hike that the organisation as important as the Railways can be turned around. Efficiency and out-of-box approach can work, and he is depending on the same, the Assocham president said.

Increased involvement of the private sector both for the passenger amenities like upgrading of stations and freight movement is a welcome sign and he is following a business like approach in moving towards the medium term targets of providing reservation on trains on demand and giving A rated service to the freight customers. Besides, the plan to diversify his revenue source, other than the present narrow basket of a few commodities is timely.

Railways ‘focus on upgrading  sub-urban transportation system in Mumbai, Delhi, Kolkata, Bengaluru and other cities should be whole-heartedly supported. At the same, we would urge Finance Minister Arun Jaitley to give full backing to the Railways since it can be a great vehicle for reviving investment in infrastructure that will result in ease of doing business and travelling for the common people.

Rail Budget 2016-17 keeps door open for Fare Hikes: India Ratings & Research

The government is also constrained by the fiscal and thus Ind-Ra believes that it is unlikely that the budgetary support will bridge the gap

India Ratings & ResearchThe proposed budget does not envisage an increase in passenger kilometer or passengers however earning from various segments are forecasted to grow by an average of 10%-12%, thus leaving the door open for fare hikes during the year, says India Ratings and Research (Ind-Ra). The government is also constrained by the fiscal and thus Ind-Ra believes that it is unlikely that the budgetary support will bridge the gap.
India’s railways, the world’s fourth largest, is a lifeline for 23 million people, most of whom are poor, and thus years of underinvestment have strained the system and a focus on improvement in existing infrastructure is the focus of the rail minister in FY17.
The Railway budget outlined a moderate increase in spending with achievable objectives to enhance the customer experience. The increase in the planned outlay of 20% yoy in FY17 compared to the 52% increase in FY16 eases the burden on the FY17 union fiscal through an almost unchanged gross budgetary support. The rail minister also talked about asset monetisation as an avenue for revenues which will reduce pressure on the government fisc.
The capex plans announced in the Rail budget focuses on creating and improving in basic infrastructure rather than expansion of routes. The increased outlay for railway electrification by 25% and the proposed electrify of 2,000 kms is likely to benefit companies that provide civil works, engineering, procurement and construction (EPC) and electrification and signaling of railway lines, namely KEC international Ltd, Larsen and Toubro, Siemens, Simplex. The railway minister plans to spend INR8.5trn over a five year period to modernise the infrastructure which will largely be beneficial to EPC players.
The targeted increase in commissioning of broad gauge lines by over 60% and electrification by 25% is likely to improve order flow and execution for companies such as KEC International Limited and Simplex. The announcement of the three new freight corridors will lead to higher orders for companies such as L&T and Tata Projects, while the two proposed elevated suburban corridors in Mumbai will mean higher order inflow for companies such as ITD Cementation, J Kumar Infraprojects and L&T.
Ind-Ra believes that the funding push from the Life Insurance Corporation of India (LIC) needs to go beyond direct lending. The rail budget announced that LIC will provide the investment push needed with funding to the extent of INR1.5trn over the next five years. LIC will need to however also provide support in the form of mezzanine funding and credit enhancement for infrastructure projects, which will in turn also help deepen the infrastructure debt market.
The increase in track laying which is planned by the railways, is likely to provide some fillip to the steel sector, which has been hit by a slowdown in global demand and over capacity. Track laying is targeted to be at 13km/day in FY18 and 19km/day in FY19.
The proposed railside logistic parks will be a threat to private container freight station and inland container depots operators namely Hind Terminals Pvt Ltd, Gateway Rail Freight Ltd. The entry of railside logistics will increase competition for the private players. The PSU- Transport Logistics Corporation of India will develop common user facilities with handling and value added services to provide end-to-end logistics solution at select Railway terminals through Public Private Partnerships. Logistics park and warehousing will strengthen the agriculture supply chain and help in better handling of food.

Rail Budget has laid down Roadmap to Develop NextGen Infra: FICCI

FICCI PresidentNew Delhi: Railway Minister, Suresh Prabhu announced rail budget speech in parliament on Thursday, Feb. 25, 2016. “The Rail Budget will cater to the needs of all satisfactorily as a lot of effort has gone into its preparation. It has been prepared in the interest of the nation and railways and he has taken the ground reality into consideration before finalising it,” said Suresh Prabhu.

Welcoming the Railway Budget 2016-17, FICCI, president, Harshavardhan Neotia said, “it is an extremely pragmatic Rail Budget based on the three critical strategy-pillars, aimed at making railways the backbone of India’s overall development. We compliment the rail minister for his initiatives towards improving the quality of customer experience, overcoming challenges and making railways an engine of employment generation and economic growth.”

The rationalization of freight policy and review of PPP policy framework would help to attract private players for transforming rail transportation and increasing the revenue, Mr Neotia added. Initiatives towards developing an integrated railway network, greater emphasis on dedicated freight corridors, and improving port connectivity as well as north-east connectivity would go a long way in expanding the freight business. Also, commendable are the measures for improving quality of travel (both unreserved and reserved), cleanliness drive through additional 30,000 bio-toilets, stress on non-fare revenues through station redevelopment & monetizing land along tracks, greater participation of state governments in implementation of railway projects through joint ventures, FICCI president observed.

”It is significant that to ensure 100% transparency in all its operations, all procurement including procurement of works has moved to e-platform, and the process of conducting recruitments online would be extended to all positions. Further, all facilities will be integrated into two mobile apps. All these initiatives are very important and in line with Prime Minister’s Digital India programme,” Neotia pointed out.

This budget has laid down the roadmap for developing next generation railway infrastructure including high-end technology to improve safety, higher average speed of freight trains and high-speed passenger trains.

Monetise Railway Land for Transit-oriented Development: Jones Lang LaSalle

The consultant defines transit-oriented development (TOD) as a mixed-use residential and commercial area designed to maximise access to public transport. TOD incorporates features to encourage transit ridership.

The Railways should monetise its land parcels at urban centres to encourage transit-oriented development and improve living standards, realty consultant JLL India said in its wish-list for the rail Budget.

The consultant defines transit-oriented development (TOD) as a mixed-use residential and commercial area designed to maximise access to public transport. TOD incorporates features to encourage transit ridership.

jll

“With the Rail Budget coming up, the sheer number of land parcels held by the Indian Railways across the country makes this entity an important stakeholder in transit-oriented development,” JLL India Chairman and Country Head Anuj Puri said in a report.

“This Budget, we expect the railway minister to look at monetising railways’ land parcels in urban areas through TOD in order to boost cities’ liveability quotient and modernisation of their skylines.”

A TOD neighbourhood typically has a centre with a transit (train/metro) station or stop and residential as well as commercial development around it. TOD interventions aim to significantly shift the mode share away from private motorised vehicles to public transport.

Given the progress of work on infrastructure projects in India, JLL said the TOD plans should be rolled out across cities soon so that the infrastructure is in place by 2020-25.

The urban infrastructure would become a key area of focus for the government as Indian cities would see more migration from rural areas, it added. JLL said Delhi is the first Indian city to move towards the TOD concept.

“TOD is also a priority area for Mumbai and was mentioned in its new development plan (DP) 2034 (currently in a draft format and undergoing several revisions).

Vashi and CBD Belapur were the first TOD projects in Navi Mumbai, with Seawoods following suit in recent years,” the report said. Haryana has recently introduced TOD, which will benefit cities, including Gurgaon.

Show Political Will and raise Passenger Fare: ASSOCHAM

ASSOCHAM meetin on Rail Budget
Business leaders participate in an interactive session organised ahead of Railway Budget by ASSOCHAM in New Delhi, on Feb 23, 2016

New Delhi: Ahead of the Railway Budget, industry body ASSOCHAM today asked Railway Minister Suresh Prabhu to muster political courage and go in for a hike in the passenger fares, saying they have been kept low at the cost of freight traffic.

“There is lack of political will to raise passenger fares even though the reluctance is not shared by passengers, who would be willing to pay more provided the hike is accompanied by better services including timely arrival of trains, cleanliness at stations, safety and improvement in food,” the chamber said a memorandum to the Railway Minister.

It said the fare increase would reduce the drastic losses on passenger traffic, now running at 68 per cent of passenger earnings.

“Passenger losses (including suburban and non-suburban) have grown from 72 per cent of social obligation cost borne by the railways in F1975 to 95 per cent in F2014. The decline in passenger losses would also have a significant positive impact on railways’ finances.

“It might also enable the railways to stop whittling away their financial cost advantage over roads as a mode of transport, by creating the potential to reduce the over-recoveries on freight to make up for the under-recovery in the passenger segment,” ASSOCHAM said.  Due to high freight charges, railway’s market share in freight has eroded.

ASSOCHAM PresidentThis year’s Railway Budget is focused on ‘Transforming Indian Railways – to transform modern India’ and has identified ‘short and immediate term wins’ and is on track for a ‘medium term’ revival plan. With many fresh ideas, this transformational Budget signals that railways are firmly on track to becoming a unique integrator of India’s growth story: Rana Kapoor, President ASSOCHAM

The total share of railways in the total transportation of freight traffic has declined from 89 per cent in 1950-51 to 36 per cent in 2007-08. At present, more than 65 per cent of the earnings of Indian Railways come from freight and around 25 per cent from passengers.

Assocham asked the Minister to speed up the public-private partnership (PPP) model for modernisation of railway stations. Mr. Prabhu had announced in his last Budget that the government will modernise 400 railway stations.

AK Agarwal, Chairman of ASSOCHAM National Council on Railway said the freight rates are used to cross-subsidise the passenger fares and this should be minimised.

The chamber has also sought removal of anomalies in the freight tariff and other charges for specific industries like aluminum, steel and iron ore.

It has sought removal of port congestion charges on aluminium industry related commodities such as alumina, bauxite, CP coke, caustic, furnace oil and coal.

Similarly, it said, the classification of these commodities should also be changed to bring the freight burden down on the crisis hit sectors.

Moreover, ASSOCHAM said, the modernisation of stations in the PPP model should be speeded up and the Swachch Bharat be implemented in all earnest in trains and the stations.

> The focus of the Budget is on enhancing customer experience and improving operating efficiency, while according greater transparency and accountability to operations of Indian Railways by means of innovative technological solutions. It budgets an increase of funds to the tune of 67% for passenger amenities and 52% for plan spending. Further, the operating ratio is targeted to improve to a 9-year low of 88.5% in FY16.

> The Railway minister has clearly identified IRCTC – the most successful public e-commerce venture as the central platform for introducing state-of-the-art initiatives such as SMS alerts, e-catering, disposable bed rolls. The Budget through focus on design & innovation led improvements, echoes the Government’s multifaceted ‘inclusive development’ agenda by furthering programs of ‘Make in India’, ‘Swachch Bharat’ and ‘Digital India’.

> By laying down the foundation for reviving investment through augmentation of capacity, the Rail Budget also demonstrates growth focus of the Government. Towards this, an allocation of INR 961 billion for doubling, tripling, quadrupling work and electrification has been made.

> The Rail Budget proposes self-sustainability and improved financial health, by creating fresh avenues of long-term financing via a revamped PPP model, investments from insurance and pension funds, monetization of surplus land resources, tendering through EPC process, to meet the envisaged investment requirement of Rs 8.5 lakh crore over the next five years

Fare hike is risky and dangerous, but there is just no other option. The mad rush in Mumbai’s local trains is a nightmare for commuters. With over double the number of passengers squeezed during peak hours, the biggest demand in the budget this year is for more trains for a decent commute.

“Students like us suffer because of crowds and to stop this, we need more coaches,” said a ‘Mumbaikar’ when asked about his commuting experience in the local trains. For senior citizens, the struggle for space is even more exhausting. “I am 73 and during peak hours it’s very difficult. A separate coach for senior citizens should be provided along with those dedicated for the specially-abled,” said a commuter. And women commuters demand the number of ladies’ compartments be increased.

Mumbai’s suburban railway network carries over 75 lakh people daily. Shockingly, since 2001, 51,000 such people have lost their lives. On an average, 3,400 passengers are killed on Mumbai’s tracks annually.

“Every day 10 commuters are dying on tracks due to overflowing trains. Today, in a train they are packing commuters of 10 to 15 stations. In 3 stations that train is packed. It makes no sense,” said Deepak Gandhi, former President of the Mumbai Suburban Railway Passengers’ Association.

Pointing out a solution to overcrowding, Mr Gandhi had recommended that the railway authorities introduce a cyclic timetable format. A method based on three key principles – limited loading, uniform frequency and clearing traffic sector-wise. This, however, has not been implemented yet.

Local trains are called Mumbai’s lifeline and for good reason. Mumbai is the only Indian city where millions depend on the local train and yet commuters complain that travelling conditions have hardly seen any significant improvement over the years. The Railway Minister is from Mumbai and understands this pressing issue, but will his budget bring some cheer for the city? That remains to be seen.

Rail Budget 2016: Capital Outlay at Rs.1.25 Lac Crore expected: Antique Ltd

Railway minister Suresh Prabhu, in his previous Budget, had said he envisages an investment of Rs 8.5 lakh crore over the next five years to achieve his stated goals

In his previous Budget, Railway Minister Suresh Prabhu had laid out a five year road map with an ambitious capital outlay for Indian railways. Brokerage house Antique expects the minister to continue on the same path despite the challenging environment and increase the overall capital outlay for FY17BE to Rs 1.25 lakh crore. The minister, in the previous Budget, had said he envisages an investment of Rs 8.5 lakh crore over the next five years to achieve his stated goals. Towards this, he was expecting support from Life Insurance Corporation of India (LIC) and the World Bank. The Railways has already signed an MoU with LIC for financial assistance of Rs 1.5 lakh crore over the next five years for construction of new lines and route electrification. It has already received Rs 2000 crore as the first tranche.

During FY16 BE, the budgeted capital outlay was Rs 1 lakh crore. Antique believes the Rail Budget will focus on improving rail infrastructure to reduce congestion, safety, upgrading the current rolling stock, dedicated freight corridor and station development. “Allocation towards wagon procurement is expected to increase to 18,000-19,000 and the ordering for coaches/MEMU/EMU is also expected to improve as there were no orders awarded during FY16,” the report states.

Meanwhile, Antique also says the current Budget will be a litmus test for the ministry given the challenging environment and to raise funding from bi-lateral/multi-lateral agencies. Prabhu, in the previous Budget, had shared an innovative way to involve financial institutions to raise extra budgetary resources. Hence, it would be interesting to watch how much of the budgeted capex the ministry was able to achieve and what is their target going forward, Antique says.

Some of the key project like the diesel and electric loco factories was cleared during FY16 and tendering for rail coach factory at Kanchrapara was also floated, the report says. There is no doubt that upgrading the current facilities and improving the rail infrastructure is the way forward for Indian railways.

Key thing to watch out for during the Rail Budget are (Excerpts):

  1. How much of the budgeted capex of Rs 1 lakh crore for FY16e has the railways been able to spend and which areas the shortfall in capex happened.
  2. What is the change in revised estimate for FY16 versus the Budget estimate?
  3. How has the overall freight/passenger earnings been? Has the operating ratio improved?
  4. For the medium to long term capital outlay amounting to Rs 8.5 lakh crore, has the rail ministry managed to get funding?
  5. Any change in the overall capex plans, given the challenging environment?

 

Antique LtdAbout Antique Group

Antique Group is a financial services conglomerate. We are a ten year old company which started off as a pure Equities Broking company and got instant recognition as a firm which believes in creating wealth for its clients and not just pure broking company.

End of 2007, two more firms merged its businesses with Antique and a new generation business was formed.

Today Antique group is a dominant player in two principal verticals vis :

  1. Equities and Derivatives Broking
  2. Wealth Management

What started as a niche financial services provider with a team of 20 enthusiasts, has now turned into a full scale professionally run financial conglomerate.

Antique’s ability to provide unique, honest and need of the hour solutions for the clients has earned itself a position which has been recognized by institutional investors around the globe and back home by Corporate India.

Our people are our biggest strength and Antique provides a working culture which is open to ideas and nurtures entrepreneurship.

ADB to fund US$1.5 bn for Bangladesh-Myanmar Railway network

ADBThe Asian Development Bank (ADB) will fund US$1.5 billion to build a rail line that will connect Cox’s Bazaar, Bangladesh’s southeastern beach resort, to neighboring Myanmar as part of a larger Trans-Asian Railway network, reported the Indian Business Standard newspaper.

On a report released on February 19, Head of Bangladesh Economic Relations Division (ERD) Saifuddin Ahmed said that the ADB has been prioritizing Bangladesh ‘s policy for development through regional connectivity.

The project under the Trans-Asian Railway corridor will set up rail links with Myanmar . The ADB wants to fund it because of its tremendous prospect, he said, adding that the bank has agreed to give US$1.5 billion in loan at two percent interest.

Some 100 km of rail lines will connect Bangladesh with Myanmar through the Ghumdhum border. Bangladesh has a 300 km-border with Myanmar and the country expects to connect by road and rail with Kunming in China through Myanmar .

Bangladeshi Prime Minister Sheikh Hasina in 2011 opened construction work on the rail line but it has been on hold until now due to lack of funds.

Release of NCAER Research Study for Indian Railways, “Factors Impacting Railway Freight Traffic in India”

NEW DELHI: NCAER  presented its study on Factors Impacting Railway Freight Traffic in India to Mr Suresh Prabhakar Prabhu, Union Minister for Railways, Mr A K Mital, Chairman of the Railway Board, and Mr Mohd. Jamshed, Member Traffic, Railway Board at the Rail Bhavan today. Present were Dr Shekhar Shah, Director-General of NCAER, Dr Saurabh Bandyopadhyay, Associate Fellow and the study’s author, and Dr D B Gupta, Senior Adviser at NCAER.

The bottom line forecast made in NCAER’s study is that Indian Railways  freight volume is likely to grow by 2.1 percent in 2016-17, as compared to its 1 percent growth in 2015-16.  This doubling of the growth rate is likely to be possible without any major policy shifts. The Railway Board requested NCAER for this short-term study to focus on Indian Railway’s freight business and to identify the reasons for the recent plateauing of its growth to around 1 percent per annum for bulk freight commodities, including coal, iron ore, cement, steel, fertilisers and food-grains, and container traffic.

The NCAER study also estimates the likely volume demand in 2016-17 for railway freight.  Freight accounts for nearly two-thirds of IR’s revenue spread over two broad categories, bulk and other goods. Indian Railway’s freight business is estimated to have grown at about 1 percent in 2015-16.  The NCAER study finds that there are several reasons for the nearly flat growth in IR’s freight business in 2015-16. The Indian economy has been passing through a difficult and challenging time since 2014-15. Deficient rainfall and two drought years in a row have lowered rural demand. Industry too remains sluggish due to low investment demand. Services, which have been a key driver for growth, have also not remained immune to the slowdown. Alongside industry, growth in gross value added in 2015–16 for the mining and quarrying sector, IR’s largest client, is estimated to be 6.9 per cent as compared to 10.8 percent in 2014–15. Crucial components of core infrastructure, coal, steel, cement, and electricity, also showed a decline in their growth rate for April–December 2015 as compared to their performance in 2014–15.

The study notes a number of commercial, operational and policy-related issues that could have an impact on IR’s freight traffic.  Said Dr Shekhar Shah, Director-General of NCAER, “The NCAER study shows that there is tremendous untapped potential for improving IR’s freight business if it can begin to meet the growing competition from the road sector. The railways need to compete on price, punctuality, and predictability, the keys to a successful logistics business.”  IR’s freight charges have gone up by 67 percent in the last five years while there has been a decline in fuel prices. Road transport for freight has now become much cheaper than rail.  Among the policy reforms suggested by the NCAER study are correcting the fare/freight ratio; providing for periodic reviews of surcharges like the port congestion surcharge and busy season surcharge; steps to encourage short lead traffic; a review of the dual pricing for iron ore; review of transportation product design to cater to market requirements of smaller parcel sizes; and liberalisation of two-point and three-point loading rules. The short-term study did not go into tariff issues, but a longer study is planned in the future to look at tariff, price sensitivity, and cross-subsidization issues.

Dr Saurabh Bandyopadhyay, the author of the NCAER study, noted “The NCAER study provides substantial insights into how the Railways’ freight revenues are closely tied to international and domestic industry developments and the need to track these developments in order to plan strategically for its brighter future.

In an exclusive interview for a programme titled ‘Ask Rail Mantri’, organised by Ministry of Information & Broadcasting soon after the Rail budget 2016 was presented on 25 February 2016, Mr Suresh Prabhakar Prabhu, Union Minister for Railways quotes thisevidence-based NCAER study while discussing the challenges faced by Indian Railways in terms of freight.

IR signs MOU with 3 IITs for setting up of Centres for Railway Research

Union Minister for Railways, Shri Suresh Prabhakar Prabhu addressing at the signing ceremony of Memorandum of Understanding (MoUs) between Ministry of Railways and IIT/Kanpur, IIT/Roorkee and IIT/Madras for setting up Centres of Railway Research, in New Delhi on December 22, 2015. The Minister of State for Railways, Shri Manoj Sinha and the Chairman, Railway Board, Shri A.K. Mital are also seen.
Union Minister for Railways, Shri Suresh Prabhakar Prabhu addressing at the signing ceremony of Memorandum of Understanding (MoUs) between Ministry of Railways and IIT/Kanpur, IIT/Roorkee and IIT/Madras for setting up Centres of Railway Research, in New Delhi on December 22, 2015. The Minister of State for Railways, Shri Manoj Sinha and the Chairman, Railway Board, Shri A.K. Mital are also seen.

New Delhi: It is well known that almost all rail operations in India are handled by the Ministry of Railways. The organization has its own facilities for production of locomotives and other rolling-stock besides a Research, Design and Standards organization to carry out research work in rail technology, standardization and application to attain self-sufficiency. Although Indian Railways has been continuously upgrading its technology but it has been primarily done through technology transfer from abroad.

The spirit of ‘Make in India’ is also the ripe time for new initiatives to build foundation for research in Indian Railways in collaboration with premier academic institutions. Minister for Railways, Shri Suresh Prabhakar Prabhu had announced in his Budget speech on 26th February 2015, the setting up of four Centres for Railway Research in select Universities. The MOU with University of Mumbai has already been signed in April 2015. Today the MOUs were signed with Indian Institutes of Technology at Kanpur, Madras and Roorkee, for setting up the Centres of Railway Research, fulfilling the Budget commitment in presence of Minister for Railways Shri Suresh Prabhakar Prabhu and Minister of State for Railways Shri Manoj Sinha.

Specific areas of research in railway technology have been assigned to the respective IITs, with provision to identify more areas in the future. Shri Manoj Pande (ED/T&MPP) signed the MOU on behalf of Ministry of Railways while signatories from other side included prof. Amalendu Chandra, Dean Research & Development IIT Kanpur, Prof. Krishnan Balasubramanian, Dean Industrial Consultancy and Sponsored Research, IIT Madras and Prof. Manoranjan Parida, Dean Sponsored Research and Industrial Consultancy, IIT Roorkee. Chairman Railway Board Shri A.K. Mital, Member Staff Shri Pradeep Kumar and other senior officers were present on this occasion.

The Minister of State for Railways, Shri Manoj Sinha witnessing the signing ceremony of Memorandum of Understanding (MoUs) between Ministry of Railways and IIT/Kanpur, IIT/Roorkee and IIT/Madras for setting up Centres of Railway Research, in New Delhi on December 22, 2015. The Chairman, Railway Board, Shri A.K. Mital is also seen.
The Minister of State for Railways, Shri Manoj Sinha witnessing the signing ceremony of Memorandum of Understanding (MoUs) between Ministry of Railways and IIT/Kanpur, IIT/Roorkee and IIT/Madras for setting up Centres of Railway Research, in New Delhi on December 22, 2015. The Chairman, Railway Board, Shri A.K. Mital is also seen.

Speaking on the occasion Minister for Railways Shri Suresh Prabhakar Prabhu announced that with the signing of these MOUs, he is confident that these Centres for Railway Research would contribute immensely towards providing solutions for utilization of Railways’ assets in a more cost effective manner. The Government’s vision to see Indian Railways as one of the most progressive organizations in the world and also a net exporter of Railway technology to the world shall soon be realized. Shri Prabhu said that such partnership between railways and academic institutions will not only help railways and IITs but will also be helpful to the nation. He said it will also lead to spin off benefits to society. There is a need to implement new ideas on real time basis.

In his speech Minister of state for Railways Shri Manoj Sinha said that Indian Railways always believes in keeping itself abreast of latest technology. Referring to the problem of train movement during fog season specially in northern India, Shri Manoj Sinha called upon experts to work on a technique to find solution to this problem. He said that the technology to solve this problem should be practical and affordable.

MOSR witnessing MOU signing2In his address, Chairman Railway Board, Shri A.K. Mital said that signing of the MOUs between Ministry of Railways and IITs at Kanpur, Madras & Roorkee for setting up of Centres for Railway Research is an important step. In order to achieve growth rate of 10% per annum in the coming years, it is necessary that railways make use of the technology advancements in the field of Railway related technology as this will be a major contributor in improving the quality of services. Government has laid high priority on giving boost to this vital sector as the Railways is considered engine of growth.

“There is one existing CRR in IIT Kharagpur. Now, there will be three more,” said Professor Krishnan Balasubramanian, dean, Industrial Consultancy and Sponsored Research (IC&SR), IIT-Madras.  The CRR, Chennai will develop technologies for the Railways in areas that it already boasts of having significant expertise.

According to Balasubramanian, the research would include but not be limited to broader areas like smart railway technologies, safety technologies and increasing communications capabilities.  The CRR’s funds will be granted by the Indian Railways and according to the institute, there are 12 faculty members who have already written up projects for the Centre.  “We hope to have 20 faculty members and 30-40 students working on projects for the Centre within two years,” said Balasubramanian.

Students can opt for UG, PG and PhD programmes to be offered under the centre which will involve projects and course electives related to railway technology. At the signing event, railway board member Pradeep Kumar said subjects on railway technology did not figure in curriculum of academic institutions leading a lack of experts on railway technology. “In most institutions, there are either no professors having expertise on the subject or wherever there are a few with some knowledge on rail technology, they are out of sync with the latest technology and development for obvious lack of practical exposure/contact,” he said.

MOSR witnessing MOU signing3Speaking on the occasion, Member Staff Railway Board Shri Pradeep Kumar pointed out that subjects on railway technology do not figure in the curriculum of the academic institutions. The natural corollary has thus been the lack of experts on railway technology in the academia. In most of the Institutions, there are either no professors having expertise on the subject or wherever there are a few with some knowledge on rail technology, they are out of sync with the latest technology and development for obvious lack of practical exposure/contact. Moreover the major technological advances are coming from out of India. This initiative of the Indian Railways to involve these premier academic institutions by setting up Centres for Railway Research will remove this gap to some extent.

Deloitte’s Railway Restructuring Report to be ready by March 2016

The country’s largest civilian employer wants to reduce its wage bill. But can the Railways convince its men? As it expands its network and reach, particularly when large scale projects are taking shape under JV/SPV/PPP models, apart from High Speed Rail lines, Indian Railways needs more manpower to maintain its tracks and for smooth operations. But the practise of matching creation of posts by surrenders, is a hassle.

Gaz OffNew Delhi: When Railway Minister Suresh Prabhu tweeted on September 24, that the Indian Railways (IR) has mandated consulting firm Deloitte to formulate a manpower policy for its gazetted officers, it left the officer-community of the public sector behemoth, confused.

It was probably the first time that the IR was roping in a consultant to take a re-look at the line-up of its officer cadre. The IR is India’s second largest employer, after the Indian Army, with a total headcount of 13.34 lakh, and a wage bill of ₹76,242 crore in 2014. Of the total headcount, 17,100 are officers, including 2,597 doctors.

The ‘railway-men’, excluding the paramedical and security personnel, total 12.2 lakh. Manpower costs, including pension payouts, constitute over 50 per cent of the IR’s cost (wages and allowances make up for about 33 per cent, and pension about 17 per cent).

Deloitte has to study the functioning and the role of the departments at the zonal and divisional levels. By evaluating the scope of outsourcing and technological up gradation, the consulting firm will suggest a more rationalised manpower of officers that will be required to run the Railways. This will determine the future recruitment of officers. Deloitte is expected to submit the report by March 31, 2016.

Officer community

The officer community is perplexed because the IR is already conducting studies, called work study, on how many posts in the organisation can be ‘surrendered’ – the organisational speak for rationalising manpower. In the last 10 years, the IR has recommended surrender of 1,35,485 posts, of which 94, 203 were actually surrendered. Where did the remaining posts go?

Data from the organisation show that for the fiscal year 2015, 14,420 posts were recommended for surrender. Of this, only 9,038 were surrendered, and the rest of the posts that were proposed, were not agreed to. Till now, 8,927 posts are pending surrender. Indian Railways did not reply to a query on why its zones have either not agreed to surrender, or are delaying it. The organisation didn’t reply to a query on the number of officers posts that the IR was planning to surrender.

A work study gives a recommendation on the number of positions that can be surrendered after analysing a particular activity conducted within the IR. Apart from studying the productivity and time taken to complete the task, the work study suggests ways, including technological upgradation, to make it more efficient. For instance, using a loop line to eliminate the reversal (change of direction) of a train helps save time, money and manpower. The study identifies posts that can be done away with. Usually, the employee is either promoted (to do away with the post) or deployed in another department with appropriate training. Sometimes, the organisation waits till the employee retires, and then makes the position redundant.

“The problem is that such work studies are not done scientifically and are conducted by untrained people who have a single point agenda – ensuring surrender of posts,” says a Divisional Railway Manager (DRM ) requesting anonymity. Most of the IR employees requested that their identities not be disclosed as the issue was sensitive.

Adds the DRM, “I was asked to surrender ticket counters based on IRCTC bookings. Why are departments arm-twisted to fall in line?” Trade unions are worried about the job security of lower-ranked employees. “They (those who conduct the study) never discuss surrendering of posts with us. The parameters used for surrendering posts are totally unilateral and totally against safety,” says Venu P Nair, Vice-President, All India Railwaymen’s Federation. A senior office bearer of the rival union, National Federation of Indian Railwaymen, says: “Work study is based on assumptions, and not practicality. IR’s policy related to the surrender of workmen’s posts should be reviewed.”

Departmental rivalry

But why are the officers, who consist of less than two per cent of the IR’s workforce, being rationalised first? The DRM says: “The Minister probably did it as a compromise. First reduce the number of officers, and then lower the staff strength down the organisation; otherwise, the unions will be up in arms. There is about three per cent retirement every year in IR. Of this one per cent is filled up, and two per cent is natural attrition. You have to take unions on board.”

Over the years, the IR has been able to reduce workforce from 18 lakh to 13 lakh. But to reduce it further to 11 lakhs, mechanisation is needed, says S.K.Sood, General Manager, Central Railway, in a recent interaction. “That will be possible only if we raise fares, and more money is spent on material and machines. With just 7 paise of every rupee earned by the IR available for doing maintenance, and procuring materials/machines, it is not feasible.” There is also a shift towards induction of skilled manpower. The latest year book of IR says that the ratio of supervisors to workers changed from 25:75 in 1950-51, to 90:10 in 2013-14.

Complicating things is the practise of matching a creation of a new post by the surrender of another. Usually, creation of a new post is based on a half-yearly requirement sent by each department. The requirement is scrutinised and put up at the AGM for approval. The unions are opposed to the practice. Nair says, “One per cent reduction in workforce every year was one of the mandates of the 6th Pay Commission. As on date, there are two lakh vacancies. Our opposition (to surrendering) is due to safety issue.”

Adds a Chief Engineer from the Electrical department: “Departments are unable to find posts to surrender whenever new assets are created. Due to the electrification across the country, new electric engine sheds have come up. We need to recruit more maintenance staff but that can be done only by surrendering existing posts. Where are the posts to surrender when we are creating a new asset?”

Moreover, there should be a simultaneous reduction in mechanical staff from the loco department (which looks after diesel engines) as electrification increases. “This does not happen due to departmental rivalry. The mechanical department refuses to let go of its employees and this is one of the reasons why surrender of posts is not agreed to by zones,” he adds. With the Bibek Debroy Committee, on the proposed restructuring of the IR, observing that a high degree of ‘departmentalism’ affected the work culture of IR, there is an urgent need to rationalise the manpower.

IR officials add that departments often display the behaviour which symbolises the proverb ‘might is right.’ Advancement in technology has ensured that operations in a railway station can be controlled by a single route relay interlocking cabin. “However, the traffic department continues to resist it, scared of losing its manpower, and in turn, its might. In a small station, for instance, controls are at three places- two cabins and a station – working 24X7. Six people were required for any shift, adding up to 24 people each day,” says a senior official from the Signal & Telecom Department.

When this operation is centralised, cabins become redundant and the requirement of manpower reduces to four. This reduces the salary bill, as only two maintenance staff are required. However, that did not happen as the Operations Department did not surrender these people. “For them, the well-being of their department is more important than the organisation. This tendency is prevalent right from the grassroots to the Railway Board,” he adds.

A paradox

Despite the need to rationalise its manpower, the IR is also facing a shortage of personnel. Says the S&T official: “There is a massive shortage of maintenance staff for signalling assets and the staff increase is not commensurate with the requirement. Frequent signal failures are due to the lack of maintenance.” The problem amplified in the last decade, with the addition of seven new zones to the existing nine. “The number of people who opted to go to the newer zones was low. For instance, the traffic accounts at Garden Reach, South Eastern Railway (SER) was trifurcated into SER/SECR(South East Central)/ECoR (East Coast Railway),” says the senior official from the zonal accounts department. “Newer zones have 100-120 people in their traffic accounts department, whereas the same department in older zones are about three times larger.

Poor financial health

Indian Railways has seen costs spiralling due to various factors such as implementation of two pay commission reports, creation of seven new zones, capacity utilisation of over 100 per cent in its trunk routes – the golden quadrilateral and its diagonals; and lack of focussed capital expenditure. In addition, there was no hike in the fare for nearly a decade even though oil prices hit all-time highs. And to add to the woes, the IR lost freight customers to other modes of transport.

“Increase in zones has led to project spill-over from one zone to another, and eventually led to conflicts,” says an officer from the Operations Department. IR is pursuing various technology initiatives through its arm, Centre for Railway information Systems, as part of an endeavour to speed up processes, reduce costs and improve service delivery. The new technologies include systems to manage freight operations information, human resources, and ticketing and reservation. Moreover, practices such as cash collection from stations, which is now outsourced to banks, are now a passé, thus unlocking manpower. Process improvements such as avoiding reversing, wherever needed, are also being implemented.

For instance, IR recently announced a change in the route of the 145-year-old Howrah-Mumbai Mail. From April, the train will no longer go via Allahabad, and will instead use the nearby Chheoki bypass. This will translate into a saving of one hour as touching Allahabad means reversing direction and change of engine. The loco change is now likely to be done at Mughalsarai, where the train asit is halts for 15 minutes.

Possible solutions

So what is the solution to the huge manpower hurdle faced by IR? The basic flaw starts at the top, says Nair. “Inter-departmental conflicts are the creation of higher ups. What are they doing? If they want they can resolve the conflict.”

Some ask for the redeployment of people from areas of surplus to those of scarcity. “If ticket-booking clerks are in excess, they can be redeployed as ticket checkers,” says an officer from the Commercial Department. “Excess people are a drag on the financials, especially when you have the Seventh Pay Commission coming up,” says the DRM. “A lot of staff is used for maintenance because of poor quality of material and spares. IR has to decide whether it wants to create mechanics or a factory, which provides high-end employment in manufacturing. For example, there is a railway workshop in Mumbai’s Lower Parel, which is on one of the most expensive real estate in the metro. Automation will ensure five times the existing output. Just tell the staff nobody will be sacked and get more output by making them work smarter with better machinery with better technology.”

But the unions say mindless automation could compromise safety. “First do technology upgradation and then find out redundant manpower then redeploy. There should be no technology enhancement without method review. They are not deploying additional manpower in sections where the number of tracks increased, for instance the same staff maintain the extra two tracks between Kalyan and Kurla in Mumbai Division,” says Nair. “There are chances of revenue leakage if suburban train ticketing is outsourced to individuals,” adds the NFIR Union official.

A recent report by Morgan Stanley on Indian Railways identified a key risk in employee costs that will strain internal generation of cash. With wages at 55 per cent of traffic receipts, internal generation is likely to be constrained, it said.

For some, a review of the organisational structure is an imperative. “A thorough examination of whether a three-tier structure of Board, Zone, and Division is required.This has to be properly assessed as it has ramifications for the whole of India. Organisation structure should be made leaner; as on date there are at least 13 levels in the hierarchy between the bottom and the top in any department,” says the officer from the Operations Department.

The recruitment system could come for a revision. At present the recruitment for officers in IR is departmentalised, and there is no fungibility of personnel between departments. A mechanical engineer remains in the Mechanical Department through his career. Similarly, a mechanical engineer recruited through the civil services examination for the accounts or personnel department, remains there. Even if there is a need, one can’t be substituted for the other.

At present, the recruitment in several departments is done through the engineering and civil services examinations conducted by the Union Public Service Commission. The Debroy Committee instead suggested two options for recruitment. One was a unified Railways Service examination.

And the other was to merge the engineering services under the Indian Railways Technical Service, and non-engineeringservices as Indian Railways Logistics Service. This would involve job rotation and an objective, performance assessment system. This may help rationalise the workforce.

Amidst all the undercurrents, it remains to be seen what Deloitte comes up with in March. (Courtesy: K Raghavendra Rao, Business Line)

Railways to seek suggestion on Regulator draft

Suresh Prabhu at FICCINew Delhi: Railways will seek suggestions from all stakeholders including public on constitution of a regulatory authority to suggest freight rates and passenger fares.

The draft of regulatory authority is ready and we will soon circulate it seeking views from all concerned, Railway Minister Suresh Prabhu today said at the FICCI meeting here.

As per the plan, public transporter will constitute Railway Regulatory Authority of India, an independent body, to decide passenger fares and freight rate, a shift of regulatory responsibility from the government to an independent regulator is required to attract private sector.

He said the regulator will fix fares for passengers and freight.

“Besides fixing fares, regulator will also have efficiency parameters. We will take the finalised draft to Parliament,” Prabhu said.

In an apparent dig at the previous regime, Prabhu said “railways is under strain because of the lack of investment in critical areas. We inherited several challenges from the past including freight and passenger operation.”

Referring to the 7th Pay Commission recommendations as “unbearable burden on railways finances”, he said, “The Pay Commission reports will have a significant impact on finances and it will also impact the operating ratio. We will see what to do.”

Describing railways as an “engine of growth”, he said railways will present its vision for 2030.

“We are working on it to present new vision 2030,” Prabhu said.

Outlining future plan, he said “We presented Rail Budget for a year and perspective plan for five years last year. We intend to invest Rs 8.5 lakh crore in the next five years.”

He said the focus is on doubling and trebling instead of constructing new lines and also improving passengers amenities like better catering service, new interior, redeveloped stations.

Prabhu said “there is a need for business-friendly approach in railways. Instead of just delivering the goods from one station to another we should think how to offer end-to-end solution through multi-modal transportation system involving other mode of transportation.

Railways in talks with World Bank: says Adviser (Finance)

The Railways is in talks with World Bank to set up a Rail India Development Fund (RIDF) in order to finance projects, PV Vaidialingam, Adviser (Finance), Railway Board, said at a FICCI conference. The Railways has already spent ₹22,000 crore of the ₹40,000 crore gross budgetary support in the current fiscal, he added.

‘Trilegal’ advises Alstom on Railway Project under Make in India initiative

Trilegal DelhiNew Delhi: Trilegal is advising Alstom on a contract awarded by the Ministry of Railways, Government of India, under the ‘Make in India’ initiative.

The deal involves the setting up a factory at Madhepura, Bihar to manufacture and supply 800 electric locomotives for the Ministry of Railways. 

The Trilegal team was led by Partners Anand Prasad and Saurabh Bhasin. The team was assited by Head – Secretarial & Compliance, Sampath Kumar, Counsels Ramakant Rai and Nayantara Nag, and Associates Rashi Ahooja, Nitikia Chabbra and Priyanka Sharma.

The total value of the contract and the new factory is $3 billion (around Rs. 20,000 crore), according to media reports.

This contract marks the first major FDI in rail projects after the limit was raised by the government in select Railways sectors.

The project also includes the development and operation of maintenance depots at Saharanpur and Nagpur for maintenance of the electric locomotives.

Wagon Makers seen waiting for Orders in Railways De-congestion Plan

As the Railways tries to address Congestion, its Focus, at least in the initial years, is expected to be on Doubling of Tracks and Efficiency Improvement rather than Wagons

New Delhi: The rebound in capital expenditure by the Indian Railways has sparked a rally in the shares of companies that depend on the national carrier for business.

Shares of Titagarh Wagons Ltd, Texmaco Rail and Engineering Ltd and Kalindee Rail Nirman (Engineers) Ltd have gained in the range of 20-40% in the last three months.

The stocks are rising on hopes that the thrust on capacity expansion and modernization will boost order inflows for the companies, especially wagon manufacturers.

w_m2m_railHowever, the initial capital expenditure trends are pointing otherwise.

Data till October says that the Railways is spending more money in construction, conversion and doubling of tracks, rather than rolling stock, which covers wagons and coaches.

The actual expenditure on rolling stock till October this year is 47% less than the year-ago period, while the expenditure on construction of new lines has risen 29% and on doubling of tracks by almost half (49%)

In fact, the actual expenditure on rolling stock till October this year is 47% less than the year-ago period. Compared with this, the expenditure on the construction of new lines has risen 29% and on doubling of tracks by almost half (49%). Investments in tracks generate orders for engineering, procurement and construction firms.

Even otherwise, the Railways’ wagon business is yet to turn remunerative for many firms. Titagarh and Texmaco, in the September quarter results, said they did not accept the Railways’ offer on wagon tender for 2015-16 due to pricing issues.

Of course, this is not to undermine the business potential from the Railways. But as the Railways tries to address congestion problems, its focus, at least in the initial years, is expected to be on doubling of tracks and efficiency improvement rather than on putting more wagons into the system.

According to a Morgan Stanley research, a focus on efficiency improvements—such as speed and a faster turnaround—can reduce the additional requirement for rolling stock to some extent.

“While we expect (an around) 50% increase in freight to be carried, if the railways are able to increase freight train speeds by 50% (from the poor 25km/hour now currently vs ~35-45 km/hour globally), the current rolling stock should be enough to deal with the increased cargo,” Morgan Stanley said in a note. “Of course, the Railways are unlikely to just focus on speed and there should also be replacement demand, which means that we will see more rolling stock purchases (but we suspect that it is likely to be more concentrated towards locos, than wagons/coaches).”

Plan to raise Spend by 285% will Transform IR: Morgan Stanley

Morgan Stanley’s Research wing estimates that the plan to spend $95 billion (over Rs 6.34 lakh crore) on ramping up Indian Railways infrastructure would result in 12 per cent GDP growth between 2014-15 to 2018-19

Morgan StanleyNew Delhi: Railway Minister Suresh Prabhakar Prabhu’s plan to increase spending by the Indian Railways by 285 per cent to $132 billion over the next five years through 2019, as against the capital expenditure of $34 billion in the preceding five years, is a positive step that will transform the Indian Railways, global investment major Morgan Stanley has said in its report.

Morgan Stanley Research’s Industrial Analyst Akshay Soni, who authored the report, believes that the “historical lack of delivery in the Railways creates scepticism, but this time could be different”. Soni estimated that India will spend USD 95 billion on railway over the next 5 years, which would result in 12% GDP growth between 2014-15 to 2018-19. This is addition to improving India’s manufacturing competitiveness because of increased productivity.

The primary reason for this optimism, according to the report, is the “reformist credentials” of Prabhu as power minister (1998-2004) and the fact that he was quick to identify the impeding elements, namely overcapacity and speed, and has also devised an innovative approach to ensure funding for projects.

“Rail is a significantly cheaper mode of transport than roads, yet the share of roads in Indian freight movement is more than 1.5 times that of the Railways, owing to the congestion in the rail network and poor policies. The railway minister is in the process of bringing change to a relatively moribund ministry. He has promised to spend $132 billion on the railways in 2015-19, a 285 per cent increase from the $34 billion spent in 2009-14,” said, Ridham Desai, head of India Research at Morgan Stanley.

The investment to be made by the railways over the next five years, along with its multiplier effect on the economy, will result in a 12 per cent increase in the growth of the gross domestic product (GDP) between 2015 and 2019, according to Akshay Soni, the author of the report.

The report says Prabhu’s plan to transform the railways through investments and capacity creation will lead to a 10 per cent reduction in India’s logistics cost, 15 per cent increase in corporate India’s profits and a five per cent rise in trade.

According to Morgan Stanley, the key reasons for the decline of the railways were under-investment, poor utilisation of funds and heavy cross-subsidisation.

Asserting that the “driver of the change is the man at the top”, Morgan Stanley has praised Prabhu’s ministry for announcing the plan in this year’s rail budget to fast-track 7,000 km of doubling of lines, involving $87 billion of investment, starting 77 new doubling projects with an investment of $962 billion and focusing on the decongestion of existing super-saturated corridors.

The firm said the railways’ efforts at exploring innovating funding models were a key reason for the optimism. This includes a $25 billion loan extended by Life Insurance Corporation (LIC) for financing the expansion of 24 saturated corridors, the funding of the dedicated freight corridor (DFC) project by the World Bank and the Japan International Cooperation Agency (JICA), the plan to develop 8,000 stations on the public private partnership route and new business models for tapping into funds for last-mile connectivity.

A former railway board member R.C. Acharya said, “The railway minister Suresh Prabhu has his priorities right and  is not only determined  but also capable of getting railways firmly on the path of growth by spending such vast sums of money, as mentioned in the report.”
However, Mr Acharya added caveat that Mr Prabhu  will have to hand pick his team, in particular the 70 odd divisional managers and over 20 general managers, to deliver.
The Morgan Stanley report also acknowledges Mr Prabhu’s role on “increasing speed of trains rather than burdening an already creaking network” and his “innovative approach to funding”.
The report states further,  “It’s clear that the railways is the answer to solving India’s transport infrastructure challenges.” According to World Bank estimates, India’s logistics costs are two to three times the best practice benchmark costs, which hurts India’s manufacturing competitiveness.
The report notes further that the railways received step-motherly treatment compared to road transport with the former getting just 20 per cent of what the road sector gets.
Another issue cited by the report is low passenger fares with the result that freight charges are used to subsidise the fares.
“Passenger fares have moved up just 28 per cent over the last decade versus a 91 per cent increase in freight rates, with passenger losses being compensated by squeezing freight customers. This has resulted in both freight moving over to road and choking internal generation of funds,” it said.

IR to spend a massive Rs 82000 Crore in Capex for Customer Satisfaction: Suresh Prabhu

The Indian Railways is on a major capital expenditure drive with Rs 82,000 crore worth of orders being placed even as it is taking a slew of steps to upgrade customer service including clean stations, e-catering and improved services.

Suresh Prabhu ASSOCHAMNew Delhi: The Indian Railways is on a major capital expenditure drive with Rs. 82,000 crore worth of orders being placed even as it is taking a slew of steps to upgrade customer service including clean stations, e-catering and improved software for ticket booking, Railway Minister Suresh Prabhu said at 95th Annual Session of ASSOCHAM held in New Delhi today.

“The Indian Railways’ capex spend would include a Rs. 40,000 crore order with the GE which is the largest order for the global conglomerate,” said Prabhu in the inaugural session of the Annual General Meeting of The Associated Chambers of The Commerce and Industry of India (ASSOCHAM).

Prabhu said, “As many as 103 announcements made in the Railway Budget for 2015-16 have been implemented with several stations showing marked improvement in cleanliness.”

Indian Railways upgrade to boost Economic Growth by 3%, says Suresh Prabhu. He added that projects were being awarded in a transparent manner and “not a single rupee tender comes to the minister. Funds were raised at an affordable rate from the LIC which is just above the G-Sec (government security) rate paid in 30 years. The ministry is also discussing the creation of a $30 billion fund with the World Bank to finance key rail projects, he said, further adding that the capex plans included Rs 82,000 crore for a Dedicated Freight Corridor project.

Addressing industry leaders at the ASSOCHAM AGM, he said that capital expenditure of Rs. one lakh crore on building new infrastructure would be spent within the current financial year in the most transparent manner.

The level of transparency has gone up to an extent where “minister is not involved not in a single rupee worth of tender. All decisions are being taken at the professional levels,” said Prabhu.

“With 1.3 million employees, the Railways is also putting in place a transparent Transfer and Posting policy along with a fair system of recruitment,” said Prabhu. “The government’s Digital India programme is being used by the Railways in providing e-catering with new facilities like base kitchens being created.”

As for structural reforms, the Indian Railways, Prabhu said, is trying to frame a regulatory system. “In the last one year or so, the situation has changed so much that despite Railways needing a massive resource, money is just not a problem.”

“Money has been raised from the Life Insurance Corporation at a rate cheaper than the G-Secs”, the minister said.
He said if things go as planned for the capex spend and boosting the Indian Railways activity, this alone could contribute between two and 2.5 per cent to the country’s GDP.

In his address, ASSOCHAM President Rana Kapoor said that the chamber has been running a successful campaign for ‘Believe in India’ seeking to generate a positive environment for taking the economic growth to 9-10 percent.
Prabhu said that the Indian Railways is on a major capital expenditure drive with Rs 82,000 crore worth of orders being placed.

The ministry is also taking a slew of steps to upgrade customer service including clean stations, e-catering and ticket booking.

“The Indian Railways’ capex spend would include a Rs 40,000 crore order with the GE which is the largest order for the global conglomerate,” he said adding that capital expenditure of Rs 1 lakh crore on building new infrastructure would be spent within the current financial year.

During the event, ASSOCHAM released a report – Believe in India: Restoring Confidence and Conviction in India`s Economy. It enlists ways to boost the growth of Indian economy.

ASSOCHAM recommends four strategic pillars which are central for ‘Make in India’.

The pillars include vital reforms in business regulations; capitalize on domestic demand; prioritize a sectoral approach and private sector capabilities through public linkages.

It suggests review of land acquisition law, further improve ease of doing business by setting up single window clearance, strengthen domestic value addition through reduced duties, GST rollout, development of industrial corridors and affordable power for industry.

It also asked the government to leverage ‘Brand India’ to create strong global brands and trustmarks across key sectors and integration of the Foreign Trade Policy with ‘Make in India’.

MRVC ask firms to come up with Detailed Engineering Designs & PMC for MUTP-3 works by Dec

mutp-iiiMumbai: Mumbai suburban railway’s most ambitious rejuvenation plan — the third phase of the Mumbai Urban Transport Project (MUTP) — was set in motion on Monday with Mumbai Rail Vikas Corporation (MRVC) calling for engineering design for three major components.

These are the construction of two more lines between Virar and Dahanu, the creation of a two-line suburban corridor between Panvel and Karjat and a 4km elevated two-line corridor between Airoli and Kalwa.

The MRVC has asked firms to come forward with detailed engineering designs as well as project management consultancy for the three works by December. Railway officials said that a loan from the International Bank for Reconstruction and Development (IBRD) — a World Bank group institution — for MUTP phase 3 was being processed.

The Virar-Dahanu 3rd and 4th lines, which will allow more suburban trains to Dahanu, are important as the railways believes the next phase of development might be in this belt and gearing up with extra rail lines is pragmatic thinking. It will also allow to speed up long-distance trains between the two stations which is not possible because the two lines existing are shared by suburban as well as goods trains.

At current prices, it will cost Rs.2,558 crore of which Rs.2,046 crore will be a World Bank loan and the rest Rs.512 crore will be shared equally by the railway ministry and government of Maharashtra. The cost of completion of this project, around 6 years from the start of construction, will see prices go up to Rs.3,555 crore, of which Rs.2,884 crore will be a World Bank loan and Rs.711 crore shared equally by the state and the railways.

The second is the Panvel Karjat suburban line will cut the distance between CST and Karjat from 100 kilometres to just 77 kilometres. At current cost, it has an estimate of Rs.1,561 crore of which the World Bank loan would be Rs.1,249 crore. The rest — Rs.312 crore would be shared by the state government and the railways. On completion, it would have a price tag of Rs.2,024 crore with the World Bank loan component reaching Rs.1,619 crore.

The third is the elevated Airoli-Kalwa connector, an elevated rail corridor about 4 km in length, will allow more people to reach Navi Mumbai from areas like Kalyan and beyond without putting added pressure on the already congested Thane station. The current price of the project is Rs.356 crore, which includes a World Bank loan of Rs.285 crore and the rest Rs.71 crore shared by the state and the railway ministry. At completion, the cost would be Rs.428 crore with the World Bank component standing at Rs.342 crore and the state-railway share totaling Rs.86 crore.

Railway Minister concludes Singapore visit on High Note

New Delhi:  Railway Minister Suresh Prabhu has concluded his two-day visit to Singapore where he held several discussions with many governmental and industry leaders on enhancing inflow of funds in various sectors of railways, an official release said today.

Mr Prabhu visited Singapore to participate as a key speaker during the Infrastructure Finance Summit 2015, organised on October 20 by the World Bank in association with the Singaporean government.

Suresh Prabhu Key Speaker at World Bank – Singapore Infrastructure Finance Summit 2015, taking a look at the presentation giving by the delegates
Suresh Prabhu Key Speaker at World Bank – Singapore Infrastructure Finance Summit 2015, taking a look at the presentation giving by the delegates

During his visit, he met Singapore’s Deputy Prime Minister Tharman Shanmugratnam and discussed the challenges being faced by the economies especially due to economic slowdown in China and the pace of new technological developments followed by a luncheon meeting with Foreign Affairs Minister Vivian Balakrishnan where discussions took place on possibilities of collaboration in development of railway stations in India.

Thereafter, Mr Prabhu met Goh Choong Phong and Tan Kai Ping, senior officials of Singapore Airlines in which the minister apprised them with the potential of Indian railways and the various projects such as creating a dedicated freight corridor to reduce the congestion of traffic as well as enhancing the efficiency of the passenger corridor.

He said given the present global economic scenario where US and Japan are not doing well on economic front, Chinese economy is slowing down, India holds a promising future and aims at reaching a double-digit growth in future especially after introduction of the proposed Goods and Services Tax.

Mr Prabhu also met Boon Chin Hau and Sid Chandrasekaran, senior officials of the GIC Infrastructure Group where he proposed participation of the company in upgradation of railway in terms of expansion of existing stations, constructing malls, offices above them, track-laying, creating separate freight and passenger corridors to reduce decongestion etc by adopting equity route and work with Indian companies on zero-risk basis with an assured financial return.

He also met representatives from Temasek Holdings – another investment company and Gopinath Pillai, ambassador-at-large for Singapore and representatives from Land Transport Authority (LTA).

Railway Regulator details soon coming Online for Comments: Suresh Prabhu

New Delhi: Details of a proposed railway regulatory authority will soon be put online to seek the views of stakeholders, Railway Minister Suresh Prabhu said on Wednesday.

“We are working on the regulatory authority and soon we will put it online,” he said while inaugurating an international rail conference here organised jointly by the Confederation of Indian Industry (CII) and the Indian Railways.

CII Conf expo hallThe establishment of a railway regulator with powers of tariff regulation was among the recommendations of the committee headed by Niti Aayog member Bibek Debroy.

It had suggested the setting up of a regulator independent of the ministry, with a separate budget.

“The Railway Regulatory Authority of India (RRAI) will have the powers and objectives of economic regulation, including wherever necessary tariff regulation, safety regulation, pair access regulation, service standard regulation, licensing and enhancing compensation and setting technical standards,” it said.

Prabhu said his ministry was determined to break the vicious cycle of low investment and low quality of services, which has enveloped the Indian Railways owing to inadequate attention being given to the vital sector.

“We will usher in a new eco-system which is vibrant, revenue generating, technology friendly so that our dependence on budgetary allocation is reduced,” he said.

Japan is the partner country for international railway equipment exhibition 2015, that is being attended by 400 exhibitors from 20 countries, including the US, Britain, China and Germany.

Prabhu referred to the excellent response he received from the Japanese government and the private sector there when he visited the country in September.

“The Japanese are excited not only about the high speed train segment alone. The new framework of technology agreement envisages a whole spectrum of partnership in various rail related segments like manufacture of electrical locomotives and sharing of cutting edge technologies,” he said.

Speaking at the inauguration, Japan’s Minister of State of Land, Infrastructure, Transport and Tourism Junzo Yamamoto expressed the hope that Japan would be a major player in India’s transformation towards high-speed or bullet trains and explained how the far-flung areas in Japan have become economically active with the induction of bullet trains.

“India also can derive these benefits upon transforming into the high speed saga,” Yamamoto said.

IR to be country’s next Growth Engine for Economy: JM Financial

Rail Money symbolNew Delhi: The government’s focus on developing and reforming the Indian Railways will help the national transporter emerge as the next growth engine for the country’seconomy over the next decade, a report stated.

Leading brokerage JM Financial has come out with its report ‘Railways: Turning the Corner’ focussing on Indian Railways.

The report stated that huge investment in the sector is expected to have a multiplier effect of 5.73% on the country’s GDP.

The government is also working on a long-term structural reforms which will help transform the Railways from a government-led monopoly, the report stated.

Over the past one decade, the government has spent only 0.3-0.5% of its GDP as capital investments in the Railways, while the roads have been getting considerably higher allocations, it said.

This neglect is even clearer from the collections of the diesel cess authorised by the Central Road Fund Act. While the Railways gets only 12.5% of the total amount annually credited to the fund, roads get 50% of the share, the report further said.

It can be noted that Prime Minister Narendra Modi-led government had chosen the Railways as a big driver for country’s growth with a capital investment of Rs 8.5 trillion over next five years, which is 3.3 times over the previous five years.

This is a clear break from the decades of under-investments in building physical infrastructure which led to lower capacity expansion.

Noting that the railways has had a weak track record for executing projects, the report notes that historically, many of its projects have suffered from time and cost overruns.

During the last 30 years, out of the 676 projects worth Rs 1,57,800 crore sanctioned, only 317 projects have been completed as of 2014. The remaining 359 projects, which currently require Rs 1,82,000 crore investment, are delayed due to various reasons such as land acquisition, cost overruns, insufficient funds, etc, it said.

Out of the 99 new lines sanctioned in the past decade worth Rs 60,000 crore, only one project is complete as of 2014.

In the past 25 years, the Railways has added a meagre 7% to its network in terms of track length to 114,907 km, while the roads have more than doubled during the same period.

Suresh Prabhu addresses Infrastructure Finance Summit 2015, Singapore

Singapore: Minister of Railways Shri Suresh Prabhakar Prabhu visited Singapore to participate as a key speaker during the Infrastructure Finance Summit 2015 organised on 20th October 2015 by theWorld Bank in association with the Government of Singapore.  Shri Suresh Prabhu was specially invited by Deputy Prime Minister of Singapore, Mr Tharman Shanmugaratnam to share experiences on the instrumental work that Indian Railways is doing in Infrastructure financing.

Suresh Prabhu World Bank SingaporeOrganised by the World Bank Group, the Singapore Ministry of Finance, the Monetary Authority of Singapore and the Financial Times, the Summit witnessed the presence of economists, thought leaders and other experts who discussed the current and future economic and financial environment with a particular focus on the opportunities and challenges in the major, dynamic economies of South and Southeast Asia. Indian Railway Minister, Shri Suresh Prabhu who was a panel speaker at the Summit spoke about the major transformation being undertaken in Indian Railways including the re-development of Railway stations.  The Summit provided a good opportunity to policy-makers and leading minds in finance to discuss the latest global initiatives, the approach of institutional investors and other private funders, the opportunities and obstacles that exist on the ground in Asian emerging economies, and the most effective strategies to accelerate progress in the current volatile economic environment.

Besides attending and speaking at the 6th World Bank – Singapore Infrastructure Finance Summit, Indian Railway Minister Shri Suresh Prabhu had a very hectic and busy schedule during his two day official visit to Singapore holding wide range of discussions with a cross section of individuals, local government functionaries and institutions; investment, industry, business leaders and groups.  During the Summit and during different interactions, Shri Suresh Prabhu among other things focused on enhancing inflow of funds for infrastructure development in India, modernization and expansion plans of Indian Railways, investment opportunities in the Indian Rail Sector etc. The visit was extremely successful and it has given a big fillip to mutual cooperation between the two countries in the field of infrastructure development.

Following is the brief report about various engagements of Indian Railway Minister Shri Suresh Prabhu during his two day (20-21 October, 2015) Singapore visit : –

  • dAbraaj Annual Forum Meet. Indian Railway Minister Shri Suresh Prabhu Hon’ble Minister attended the Abraaj Annual Forum Meet where Hon’ble Deputy Prime Minister of Singapore, Shri Tharman Shanmugratnam spoke about challenges being faced by the economies especially due to economic slowdown in China and the pace of new technological developments.
  • Luncheon meeting with Hon’ble Minister for Foreign Affairs of Singapore, Dr Vivian Balakrishnan.
  • Suresh Prabhu had a luncheon meeting with the Singapore Foreign Minister on 20 October, 2015, where discussions took place on possibilities of collaboration in development of India Railway stations.
  • Interview with James Kynge of Financial Times. Shri Suresh Prabhu gave an interview to Mr James Kynge, Emerging Markets Editor of Financial Times.
  • Meeting with representatives from Singapore Airlines : Shri Suresh Prabhu had a meeting with Mr Goh Choong Phong, CEO and Mr Tan Kai Ping, Senior Vice President of Singapore Airlines in which the Minister apprised the Airlines representatives with the potential of Indian railways and the various projects such as creating a dedicated freight corridor to reduce the congestion of traffic as well as enhancing the efficiency of the passenger corridor. On being asked about private participation in Indian Railways sector, Shri Suresh Prabhu told that various activities and services are outsourced to private players and private investment is sought under various schemes for railway infrastructure development.  The Minister also mentioned that given the present global economic scenario where US and Japan are not doing well on economic front, Chinese economy is slowing down, India holds a promising future and aims at reaching a double-digit growth in future especially after introduction of GST.
  • Meeting with representatives of GIC Group. The Indian Railway Minister had a meeting with Mr Boon Chin Hau, Senior Vice President and Mr Sid Chandrasekaran, Assistant Vice President, GIC Infrastructure Group. Formerly known as Government of Singapore investment company, GIC is a sovereign wealth fund established to manage Singapore’s Foreign Reserves.  It is one of the few global firms with highest credit ratings.  GIC invests internationally in fixed income, equity, real estate and special projects.
  • Explaining the Indian Government’s decision to open up the Railway to private stakeholders, Shri Suresh Prabhu stated that the Indian Railways has got a constant stream of income to provide reasonable facilities and comforts to the people travelling on rails from sources such as provident funds, insurance etc. However, GIC could perhaps participate in upgradation of railway in terms of horizontal expansion of existing stations, constructing malls, offices above them, track-laying, creating separate freight and passenger corridors to reduce decongestion etc by adopting equity route and work with Indian companies on zero-risk basis with an assured financial return.
  • Meeting with representatives from Temasek.   The Indian Railway Minister Shri Suresh Prabhu had a meeting with Mr Rohit Sipahimalani, India Head and Ms. Juliet Teo, Managing Director of Temasek Group. Temasek holdings is also an investment company owned by Govt. of Singapore.  Its portfolio of $177 bn covers broad spectrum of sectors including financial services, telecommunications, media, consumer, transportation and real estate.
  • The Minister explained various programmes which the Government is working upon towards modernization of Indian Railway as well as the investment opportunities the Government is contemplating to provide to the private investors. Mr Rohit asked how does the Minister think on aligning the two corridors (freight and passenger) and whether both could fruitfully co-exist. The Minister optimistically replied ruling out any possibility of conflict between the two corridors and stressed that, in fact, the two corridors could co-exist in a healthy relationship complementing each other by cross-subsidization. When asked what challenges the Government is facing towards modernization of Indian Railway, the Minister replied that though the challenges are there, however, the Government looks forward to overcoming those challenges in next 3 and half years.
  • Meeting with Amb Gopinath Pillai(Ambassador-at-large for the Government of Singapore). Shri Suresh Prabhu had a meeting had a meeting with Amb Gopinath Pillai as well in which matters pertaining to technological cooperation between India and Singapore especially in the field of training and skill development were discussed.
  • Meeting with representatives from Land Transport Authority (LTA) of Singapore Government. Shri Suresh Prabhu met Mr. Chew Men Leong, Chief Executive, Ms. Sim Wee Meng, Senior Group Director and Mr V. Venkataraman, Director, Cost Control of LTA, Singapore. Having given a brief idea on Railway system in India including its various modernization programmes such as upgradation, creating separate corridors for freight and passengers, vertical expansion of existing Railway stations, track-laying etc, the Minister sought LTA’s interest whether they could participate in the modernization bid of Indian Railway.  The Minister said that relevant information would be shared with them and they would be informed about the bids through the High Commission.

Suresh stresses for Integrated IT enabled Accounting Architecture for Railways

suresh prabhu it reformsAs a part of its concerted effort to introduce the major initiative of ‘Accounting Reforms’ in Indian Railways as per the 2015-16 Rail Budget announcement of the Railway Minister Shri Suresh Prabhakar Prabhu, several Workshops and seminars are being planned and organised. Continuing with such efforts another important Workshop, to share global experience, was held here on 07-10-2015 by the World Bank on “Accounting for Accountability”. It was organised in collaboration with Ministry of Railways. The Workshop was chaired by Minister of Railways Shri Suresh Prabhu and was attended by senior officials of the Railway Board, Zonal Railways, Railway PSUs and participants from the ICAI and the World Bank. A delegation of speakers, from various countries like New Zealand, Australia, Poland and USA, with expertise in railway operations, participated in the workshop and made presentations addressing operational and financial aspects of rail operations for small, mid size and  large railway networks.

The workshop is part of concerted efforts to implement the major initiative of Indian Railways on introducing Accounting Reforms as announced in 2015-16 Railway Budget

The Minister of Railways Shri Suresh Prabhu while addressing the Workshop emphasised that the project initiated by Indian Railways for introducing Accounting Reforms assumes greater relevance today considering the fact that Indian Railways is embarking on huge investments in infrastructure both from government and institutional finance. The resources thus would need to be used in the most diligent manner. In this context he stressed the need for a system approach in developing an integrated IT enabled accounting architecture with a clear focus on measurement of outputs and outcomes of operational activities while formulating the budget. The Minister also emphasised the need to focus on the determination of cost of services with an aim to determine a rational pricing structure for the Railways. The proposed accounting framework would provide greater transparency and promote good governance, he said.

The other speakers at the workshop shared their experience of transforming their respective accounting systems to serve management need for activity based unit costing and outcome budgeting for informed decision making for efficient operations and cost controls

Minister of Railways, in the budget speech of 2015-16, had announced the formation of a Working Group to modify the present accounting system of Indian Railways to enable tracking of expenditure to desired outcomes and online availability of costing data in key performance areas like operation, construction, capacity augmentation, maintenance and post asset commissioning evaluation.

In order to give effect to the budget announcement, Indian Railways has engaged the Institute of Chartered Accountants of India in developing a design for implementing an integrated Outcome Budgeting and Performance Costing System. An Advisory Body consisting of domain experts and a multi disciplinary Working Group of Railways has been constituted to assist the ICAI in designing a detailed framework of proposed accounting system as envisaged in the budget announcement.

In addition, IR is also conducting a pilot study on introduction of Accrual Accounting at Ajmer Division and Ajmer group of Workshops with the assistance of the Accounting Research Foundation of the Institute of Chartered Accountants of India.

Weighty Challenge: Solar Powered Coaches will have to rework Coach Weight

Solar powred train coachChennai: The Integral Coach Factory’s (ICF) trials, in collaboration with the Indian Institute of Science (IISc), Bangalore, with solar powered coaches have been successful, but has now thrown open another weighty challenge.

The solar panels, while generating enough electricity to power a non-air-conditioned coach, are also creating a problem of adding to the deadweight of the coach. This means that coaches with the panels will have to be redesigned and engineered to ensure that the weight of the coach does not go up.

“We have received the report from IISc. We are taking a further call on it. The solar panels, however, add to the weight of the coach. Some framework is required to mount the panel on the roof. Without adding extra weight, we have to see how to bring power to the coach,” an ICF official told.

In June, the Railways rolled out its first solar panel-enabled coach that generated about 17 units of power in a day to enable the lighting system in the coach on the Rewari-Sitapur passenger train. The department has plans to generate about 1,000 MW in the next five years. Through this plan, the Railways hopes to reduce the amount of electricity it draws from the grid.

However, mass production of solar powered coaches will be viable when the issue of the deadweight is solved. “We can have batteries to store the solar power generated during the day, but that will require a large number of batteries which will once again add to the deadweight,” the official pointed out. “The panels can be embedded on the roof itself. But, it will require extensive design change in the roof. A commercially viable solution is required,” the official added.

Some framework is required to mount the panel on the roof

Indian Railways will exceed Rs 8.5 Lakh Crore 5 Year Capex target: Suresh

Station development project to attract 20 billion USD: Suresh Prabhu

New Delhi:  Days after a report that the Prime Minister’s Office had expressed concern over a slow pace of spending by the railways, minister Suresh Prabhu said they’d “far exceed” the capital expenditure target of Rs 8.5 lakh crore set for the five years till 2019, including this financial year’s budget target of a little over Rs 1 lakh crore. Maintaining that funds will not be a problem for completing infrastructural projects for the Railways, the Minister said the capital expenditure for this year will surpass the budget estimates.

Suresh Prabhu at a seminarThe Minister was talking to reporters here on Monday on the 11th edition of International Railway Equipment Exhibition (IREE), scheduled from October 14 to 16 at Pragati Maidan. The IREE is organised by the Railway Ministry and the Confederation of Indian Industry. Prabhu said almost 89 per cent of the budget announcements made by him have been fulfilled.

“We will easily surpass the target. The budget did not talk about the Dedicated Freight Corridor project, the funding for which, Rs 82,000 crore, was recently approved by the cabinet. We have already issued contracts worth Rs 15,000 crore in the six months of the current financial year. The rest will come soon,” he told reporters.

Additional spending would, he said, materialise from two other initiatives by the ministry. One is “using the money from customers like Coal India and Steel Authority of India for rail evacuation projects, for which memorandums of understanding are being signed with state governments and port connectivity projects.”

RM declarationsPrabhu also said he had, in a meeting last week with World Bank chief Mulyani Indrawati, discussed the possibility of creating a $30 billion fund to finance key rail projects. “We will make an announcement at the right time,” he said, refusing to share details but disclosing the Bank would act as anchor investor for creation of the proposed fund.

The minister said additional funding of $15-20 bn would soon materialise from implementation of the government’s plan to award contracts for redevelopment of 400 stations on the Swiss Challenge method, a model of project development under public-private partnership which was recently approved by the cabinet.

He also announced a plan to seek Rs 1.5 lakh crore from Life Insurance Corporation for investments in railway projects with a high rate of return has been approved by the board of the state-owned insurer. “Also, 17 states have given their approval for investments through creation of joint ventures for new line capacity creation projects. Putting all this together, we will exceed the Rs 8.5 lakh crore plan,” he said.

Prabhu also said at least Rs 70,000 crore will come “within the next few months” from award of two contracts — for setting up diesel and electric locomotive factories in Bihar, and supply of 15 electric multiple unit train sets or 315 railcars for improving the speed of Rajdhani and Shatabdi trains. Bids for the loco factories were opened by the ministry earlier this month; it is yet to announce the winners.

The Minister announced that the Railways has taken an ambitious programme of electrifying about 10,000 km of railway lines in the next five years. When asked for details of the funding, he said the government will announce it at the appropriate time. “Discussions are still taking place,” he added.

Prabhu said discussions with Japan and South Korea have progressed to build water-less odour-less toilets in trains. He said Google has offered cooperation to set up WiFi connectivity in stations and platforms.

Solar Power panels atop Train Coaches can save 11 Crore Litres of Diesel, reduce 3 Lakh Tons of Carbondioxide Emissions: IISc Scientists

Chennai: Fitting a solar panel module on the roof of a railway coach can yield more than 7,200 units of electricity every year. If implemented on all 63,511 coaches in the Railways, 450 million units of power can be harnessed resulting in savings of 10.8 crore litres of diesel and reduction of carbon dioxide emission by approximately 3 lakh tonnes.

These are the findings of a pilot field research conducted by a team of scientists from Indian Institute of Science, Bangalore, who travelled on a solar-panel fitted LHB (Linke Hoffman Busch) coach, a latest German technology bogie, which was attached to the Chennai-Coimbatore, Chennai-Mysore Shatabdi and Chennai-Bangalore Double Decker Express trains on different days during June 24-July 2. The research was carried out to assess the feasibility and viability of generating electricity on a moving train from solar panels fitted on the rooftops of trains and the impact of factors like sunshine, train speed, number of halts, track curves, etc.

Power on TrackThe pilot study was carried out in a ‘worst-case scenario’, i.e. during the onset of the Southwest monsoon on railway routes with low sunshine due to clouds or rainfall. Hence the electricity generation in places and seasons of harsher sunshine would give a greater yield, thereby projecting a figure bigger than what was arrived at in this study.

The coach could generate a maximum of 1.8 units of electricity per day, according to the research findings. This was extrapolated to a scenario where 24 such panels (12X2 module) could be retrofitted on the coach.

Thus, the resulting yield was assessed to be 18-20 units per day. The figures for yearly savings have been arrived at by assuming that the coach would be in operation for 365 days a year in the report, though the industry standard is 330 days.

The study was done on the Shatabdi Express as it has minimum stoppages; however, the team wanted to measure the power yield at lower speeds and hence the Double Decker Express train was chosen. The team also reported on a number of practical factors which contributed to fluctuations in electricity generation during all the trial runs. A static trial was also carried out at the Basin Bridge yard here to compare the parameters with the dynamic trial.

The study is significant in the context of the shift by the Railways from conventional coaches to German technology LHB rakes, which have better safety features. For operation of electrical appliances inside an LHB coach, power supply from the End on Generation (EOG) system (a generator) is needed, which consumes 0.25 litres of diesel to generate 1 unit of electricity. If every LHB rake is fitted with 12X2 Solar Photovoltaic (SPV) module, it would result in huge energy savings as well as cut environmental pollution caused by burning diesel.

The study findings could be used to manufacture and design many such Solar Rail Coaches on a large-scale which could significantly bring down the price of the solar panels and operational costs. In addition, with increased interest in the field of solar energy research, an advancement in technology raised the possibility of a yield greater than what was obtained during the field trials, resulting in greater diesel savings and an effective solution for reduced emissions. Railway officials noted that implementation of the project on a wider scale could provide a fillip to the domestic solar panel manufacturing industry in line with the ‘Make in India’ initiative.

Mulyani Indrawati, MD & COO, World Bank travels by Mumbai Suburban Local Train

World Bank also to extend funds to improve Mumbai suburban train services and will continue to invest not only in improving the frequencies but also give priority to enhancing security and safety apart from sanitation facilities. World Bank is also keen to fund Mumbai’s two Metro corridors

Smt. Mulyani Indrawati, Managing Director and Chief Operating Officer of the World Bank Group walks after disembarking from a local train at Andheri
Smt. Mulyani Indrawati, Managing Director and Chief Operating Officer of the World Bank Group walks after disembarking from a local train at Andheri

Mumbai: The World Bank has shown interest in funding the city’s public transport infrastructure, including two Metro Railway projects planned in the western suburbs.

Going by the talks between World Bank MD Ms.Mulyani Indrawati and Chief Minister Devendra Fadnavis held on Tuesday, the funding may be extended for the 20-km D N Nagar-Dahisar (W) corridor, which will cost around Rs 4,388 crore, and the 16.5-km Andheri (E)-Dahisar (E) corridor, which costs an estimated Rs 4,183 crore.

She spoke to female commuters en route to understand their woes during commutation on Tuesday. She promised all support to upgrade Mumbai’s railway infrastructure.

Indrawati is on a three-day visit to India to explore opportunities for collaboration, a World Bank release had said on Monday. She is accompanied by Annette Dixon, the Bank’s Vice President for the south Asia region.

Indrawati said the bank would extend long-term loans to major transport infrastructure projects in the city and the rest of Maharashtra and was also positively considering its support for the two Metro projects on priority. The three local lines – the Western, Central and Harbour lines – together carry more than 10 million passengers a day, making the lifeline of the commercial capital that is home to close to 19 million people (in the island city alone) while the number of people in the Mumbai metropolitan region is well over 30 million.

The 32-km Colaba-Bandra-Seepz underground Metro corridor, which costs around Rs 24,000 crore, has already received funding from the Japan International Cooperation Agency. The detailed project report of another corridor between Kasarwadalavali and Wadala via Thane and Ghatkopar, which is estimated to cost around Rs 25,000 crore, is being drawn up to attract financers.

World Bank MD and COO Sri Mulyani Indrawati (right) commutes in a ladies compartment of a suburban local in Mumbai
World Bank MD and COO Sri Mulyani Indrawati (right) commutes in a ladies compartment of a suburban local in Mumbai

On Tuesday, Indrawati, who is also chief operating officer of World Bank, sought feedback from woman passengers while travelling on one of the Bombardier rakes that were recently procured under the Mumbai Urban Transport Project-II. “I travelled in the women’s compartment of a local train from Churchgate to Andheri. The commuters told me that they really appreciated the new trains, but raised concerns about security.” She also expressed the World Bank’s interest in getting involved in MUTP-III.

Among the issues raised by the commuters were better ventilation and security on trains and improved sanitation on railway premises. “There should be better ventilation as it becomes difficult to travel in crowded compartments during peak hours,” said commuter Roshni Bagdi, who lives in Andheri. Another commuter Jayshree M added, “The toilets on stations are not maintained and most women avoid using them.”

The woman commuters also demanded better frequency of services, especially on the Harbour line.

Lauding the state government’s initiatives to enhance the ease-of-doing-business index, Indrawati gave an assurance that the World Bank would aid the initiatives aimed at improving the city’s existing public transport. “We have a long tradition of partnering with the Railways and we have been investing in hard infrastructure. But now we also plan to invest in improving basic sanitation facilities on stations, and improve safety and security, increasing the frequency of services,” Indrawati said.

The World Bank is also keen on investing in the state’s agriculture sector. Fadnavis also called upon the World Bank delegation to extend their support to his pet project aimed at creating artificial lakes and ponds to strengthen the ground watertable.

Minister of state for urban development Dr Ranjit Patil, chief secretary Swadheen Kshatriya, additional chief secretary (finance) S K Shrivastav, ACS (protocol) Sumeet Malik, MMRDA commissioner U P S Madan, principal secretary to the CMO Pravin Pardeshi and UD secretary Manisha Mhasikar were present at Tuesday’s meeting.

“I had a very good meeting with the chief minister. He identified natural calamity resilience, urban services, including railways, and affordable housing as priority areas for the bank support to the state. I reiterated the bank’s willingness to work closely with the state government in these areas,” said Indrawati.  She also praised the state’s ‘ease of doing business’ policy and expressed keenness in partnering with the government to upgrade Mumbai’s public transport system.