July 24, 2016

Revamping Railway Stations Under PPP Model

Indian Railways has advertised its plan to redevelop ‘A-1’ and ‘A’ category stations (about 400 in number) on ‘as is where is’ basis, by inviting proposals from developers with their designs and business ideas. The entire cost of station redevelopment is to be met by leveraging commercial development of land and air space in and around the stations. The general guidelines have been issued to Zonal Railways in this regard.

In addition to above, redevelopment of eight stations viz., Anand Vihar, Bijwasan, Chandigarh, Gandhinagar, Habibganj (Bhopal), Shivaji Nagar (Pune), SAS Nagar (Mohali) and Surat has been entrusted to Indian Railway Stations Development Corporation Ltd. (IRSDC). Model Development Agreement has been finalized by IRSDC, which envisages redevelopment of stations, associate real estate development and their operation and maintenance (O&M) through a developer, to be appointed following a transparent bidding process. Bids for redevelopment of Habibganj station have been finalized and development agreement signed. Request for Qualification (RFQ) for Anand Vihar station has been finalized and RFQ for Bijwasan station has been opened.

The business model of station redevelopment project is such that generally there is no requirement of Viability Gap Funding (VGF). However, in the case of Gandhinagar station VGF has been agreed to by Ministry of Railways