|Railway minister Suresh Prabhu|
PRESENTING his maiden Railway Budget on February 26, railway minister Suresh Prabhu announced the formation of a separate railway PSU called TRANSLOC apart from mulling a host of measures to bring the ailing railways back on track.
In his budget speech, Prabhu said: “We propose to set up a PSU - Transport Logistics Corporation of India (TRANSLOC), to 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. In the initial period, it has been proposed to upgrade 10 existing goods sheds of Indian railways and develop 30 small multi-modal logistic parks where Indian railways has surplus land.”
In a bid to work closely with the states to make the railways the backbone of national connectivity, Prabhu proposes that railways will partner with PSUs to ensure that sufficient capacity is built to transport critical commodities like coal, iron ore, and cement, etc., from where they are extracted or imported to where they are consumed or processed.
He also proposed to set up JVs with major public sector companies who are our customers for meeting their requirements of new lines. Such focused execution of works will ensure faster completion and ultimately provide the much needed path for them to transport their produce and at the same time generate revenues for railways.
“It is also proposed to set up JVs with our major public sector companies who are our customers for meeting their requirements of new lines. Such focused execution of works will ensure faster completion and ultimately provide the much needed path for them to transport their produce and at the same time generate revenues for railways,” the minister said in his 67-minute speech.
For resource mobilisation, he proposes to generate resources through market borrowings, routed through partnerships with railway PSUs and IRFC. This element is projected at Rs 17,136 crore and is aimed at accelerating completion of capacity augmentation projects. This new vista being tapped has promising potential. Works proposed to be financed through this mode are listed in the Budget documents.
As railways have a big shelf of projects, which require to be executed at a fast pace, the expertise of railway PSUs will be used by leveraging their balance sheets to expedite the completion of identified projects within specified time lines and to undertake a higher volume of activities.
He proposes to create new vehicles to crowd in investment from long-term institutional investors and other partners. “These may include setting up an infrastructure fund, a holding company and a JV with an existing NBFC of a PSU with IRFC, for raising long term debt from domestic as well as overseas sources, including multilateral and bilateral financial institutions that have expressed keen interest in working closely with railways in this endeavour.”
Prabhu said government will “monetize our assets rather than sell them.”