The Rail Budget 2012-13 has sought to impart a major push to the government’s showcase Rs 90,000 crore Dedicated Freight Corridor (DFC) project through both increased equity injection and assurance of smoother land acquisition. The twin issues, experts say, had the potential to severely delay the project’s progress. The DFC project aims at boosting freight traffic growth by setting up rail lines dedicated for goods transport. Currently Indian Railways carries mixed traffic failing to capture the demand for high freight movement.
“The new Rail Budget has provided for Rs 2,000 crore investment by the government for land acquisition and equity in DFC for the next fiscal. This will allow us to match the equity infusion levels with the rising loan component in the overall financing. We are very happy,” a senior executive from the Dedicated Freight Corridor Corporation of Indian Ltd (DFCCIL) told Business Standard. DFCCIL is a company set up under the aegis of the Rail Ministry.
The DFC project covers 3,300 kilometre (km) including 1,500 km of the western arm along the Delhi-Mumbai stretch between Dadri near Delhi and Jawaharlal Nehru Port Trust (JNPT) in Mumbai traversing through Haryana, Rajasthan and Gujarat. The eastern arm of the project would stretch between Ludhiana and Dankuni in West Bengal.
Around 65% of the total 10,700 hectare of required land has been acquired and bidding process for civil works has commenced, Rail Minister Dinesh Trivedi informed Parliament while presenting the Rail Budget today. “Contract for civil and track works for 1,000 km on eastern and western DFCs would be awarded during 2012-13,” he added.
DFCCIL would open the technical bids for the 300-km long Kanpur-Khurja section on the eastern DFC later this month. This will be followed by finalising the financial bids in four months. Construction on the stretch would begin in August. Work on another 600 km stretch on the western corridor would commence by December this year.
“We have already tied-up $2.5 billion soft debt from the World Bank and another around 700 million Chinese Yuan (CNY) for funding,” the DFCCIL executive said. Of the Rs 2,000 crore investment lined up in 2012-13, around Rs 1,000 crore would be spent on Kanpur-Khurja section of eastern corridor alone.