MRVC mulls leasing trains instead of buy to reduce CAPEX, ease-out process of repayments

MUMBAI: The Mumbai Railway Vikas Corporation (MRVC) is exploring the possibility of getting suburban locals on lease, instead of buying them, under the third phase of Mumbai Urban Transport Project (MUTP-III).

The move is aimed at reducing capital investment and easing the process of repayments.

Mumbai’s railway infrastructure’s planning and execution body has decided to appoint a consultant to study how feasible the idea is and discuss the operational, financial and regulatory aspects involved.

“We want to study if it is possible to lease suburban trains, how such a plan can be implemented in Mumbai and what procedures need to be adopted for leasing rolling stock,” Prabhat Sahay, Chairman and Managing Director, MRVC.

He added that leasing rolling stock — any vehicles that move on a railway — could save a lot of initial capital investment and the earnings from the initiative would help them make payments.

The Indian Railways has taken rolling stock on lease from the Indian Railway Finance Corporation.

The state government and Indian Railways have undertaken the MUTP-III to improve suburban connectivity in the Mumbai Metropolitan Region. The estimated cost of the project is Rs10,950 crore, of which suburban locals are expected to cost Rs3,491 crore.

MRVC planned to get 47 air-conditioned 12-coach locals as part of this project.

Under MUTP-I and MUTP-II, the MRVC bought non-air-conditioned locals from the Chennai-based Integrated Coach Factory, fitted with electric systems from Siemens and Bombardier.

The cash-strapped Brihanmumbai Electric Supply and Transport (BEST) has also decided to take buses on lease.