Indian Railways to get Regulator as it starts process of allowing Private Operators

The private entities for undertaking the project would be selected through a two-stage competitive bidding process comprising of RFQ and Request for Proposal (RFP).

NEW DELHI: Ministry of Railways recently invited Request for Qualifications (RFQ) for private companies to operate passenger train services over 109 Origin-Destination (OD) pairs of routes through 151 trains. Note that these 151 trains to be run by private operators once the selection process is over, would be over and above the already existing trains.

As the national transporter readies for allowing private operators to run passenger train services, Railway Board chairman V.K.Yadav told that the national transporter will get a regulator.

Note that the private entities for undertaking the project would be selected through a two-stage competitive bidding process comprising of RFQ and Request for Proposal (RFP). RFQ process will be for pre-qualification and shortlisting of the bidders based on their financial capacity, who will be required to share Gross Revenue at RFP stage for undertaking the project

While this reform will attract private sector investment, Railways has decided not to outsource the Railway Protection Force (RPF) and its hospitals even as it considers getting out of running schools. Yadav earlier told the publication that there was a proposal to set up a Rail Development Authority, they are now reviewing its terms of reference.

The Railway Board Chairman was quoted in the national daily report saying, “We want to review that proposal in the current situation because when it was formulated there was no discussion about private sector participation in passenger train operation. We will have to go for some sort of RDA”.

It is worth mentioning that in 2017 as well, the department of personnel and train had finalised the process of selecting a regulator. However, it did not materialize. With private operation of trains, the role of the regulator has become all the more important in order to ensure the protection of consumer interests.

This is the first initiative of private investment for running passenger trains over the Indian Railways network and the project would entail private sector investment of about Rs 30,000 crore. The private entity selected, will pay to Indian Railways fixed haulage charges, energy charges as per actual consumption and a share in gross revenue determined through a transparent bidding process.

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