Centre moots PPP model for Bengaluru Suburban Rail

BENGALURU: In a move that could further delay the Rs 22,242-crore Bengaluru suburban rail project, which was first mooted in 1983, the Centre has suggested a public private partnership (PPP) model.

Now, the railways and the state will have to rope in private players and revise the detailed project report (DPR) which may take another six months to one year.

In an April 10 letter to the Karnataka Rail Infrastructure Development Corporation (K-RIDE), the nodal agency implementing railway projects in Karnataka, the railway board said: “…Considering revised financials with viability gap fund (VGF) and with revised contours, possibility for individual point-to-point projects through PPP should be explored.”

This, it said, should be facilitated by the state and the ministry of railways by offering surplus land or VGF and structure it on a revenue-sharing basis. Earlier, the cost sharing of the project was 20% each of equity by the state and railways and the remaining 60% through loans.

Higher fares & another DPR?

Indicating that fares could be higher, the letter read: “Fare box revenue shall be planned in a manner that it would meet operations and maintenance costs duly comparing fares prevalent in other modes of transport.”

Sources say the PPP model may speed up the project, but it relies on the participation of private firms. Many private players are hesitant to work with railways because of stringent norms. But Metro rail systems in Mumbai, New Delhi (airport express line) and Hyderabad are developed on a PPP model.

The railway board asked K-RIDE to bifurcate the proposed four corridors into several point-to-point projects. This means each corridor will be taken as separate project and private players are likely to take up only commercially viable routes.

It was earlier decided that the yet-to-be formed special purpose vehicle will be a partnership between Karnataka and the Centre with 51:49 ownership.

Citing a letter from the Prime Minister’s Office, the railway board has asked K-RIDE to re-structure the proposal and revise the DPR prepared by RITES. “Suburban lines should not compete with Metro. They should be planned to bring people from/to suburban areas of the city and for its development as nodal centres,” the board said.

The letter stated that number of suburban stations within the city should be reduced.

The state on January 16 submitted 19 conditions—the 161km-network to be increased to 360km, connecting suburban areas, and shelving of the Kengeri-Whitefield suburban rail route in the RITES report as it overlaps with the proposed Metro alignment.