 "Dedicated freight corridors to be commissioned by 2018: Adesh Sharma")
After years of delay, work on the Rs 81,000-crore dedicated freight corridor (DFC) project, India’s ambitious attempt to reform freight transport, has picked up pace. With most land and funding requirement tied-up, Dedicated Freight Corridor Corporation of India (DFCCIL) is confident of starting phased commissioning from 2018, Adesh Sharma, managing director of DFCCIL, told Sudheer Pal Singh in an interview. Edited excerpts:
What is the progress of the project?
The DFC project has gained momentum and there is significant increase in the progress of work in the Rewari-Iqbalgarh section of the western corridor (WDFC) as well as in the Khurja-Bhaupur section of the eastern corridor (EDFC), despite several land constraints. Funding for both the corridors has been tied up, except for the Khurja-Ludhiana section of the eastern corridor, for which negotiations with the World Bank are on. Securing land and tying up funds are the two most crucial steps for any infra project, followed by the award of the contracts and monitoring the progress. We are currently working on all the four stages simultaneously. Of the total 3,350 km of the DFC project, work is in progress in 360 km in EDFC and 650 km in WDFC. Civil contracts have been awarded for the Kanpur-Mughalsarai section of EDFC during March 2015.
What is the progress on land acquisition? How would the talks on the land Bill impact the project?
Acquisition of land is the first requirement. DFC is a linear project of more than 3,300 km; 10,537 hectares have to be acquired. So far, 8,874 hectares have been acquired, 84 per cent of the land requirement, excluding the Sonnagar-Dankuni section (on PPP basis). There are patches of land yet to be acquired, affecting 245 km in the eastern corridor and 113 km on the western corridor. The matter is being vigorously pursued with the state governments. Most of these patches are in Uttar Pradesh, Bihar, Gujarat and Maharashtra. Acquisition of balance 16 per cent is certainly an area of concern as the provisions of the new land acquisition Act will apply soon.
What is the latest cost estimate for the project and how much of funding has been tied up?
The total cost of DFC is Rs 81,460 crore, excluding the Sonnagar-Dankuni section being built on private-public partnership mode. Of the total, two-thirds was arranged via debt and the rest via equity of the rail ministry. EDFC is funded by the World Bank. WDFC is funded by Japan International Cooperation Agency (JICA). The World Bank will provide $2.72 billion. Agreements have been signed for two loan components for $2.10 billion. The second loan agreement was signed in December 2014. JICA will provide loan of 645 billion yen. Expenditure till April 2015 is Rs 13,250 crore, including land.
What is the progress on placement of contracts?
The process of fixing contracts was initiated after tying up the funds and achieving at least 75 per cent progress in land acquisition. Contract for Rs 4,000 crore were awarded during 2013 in the Khurja-Kanpur section of EDFC. Similarly, contracts for Rs 7,000 crore were awarded between Rewari and Iqbalgarh during August 2013. After tying up funds for EDFC-2, recently a contract for Khurja-Kanpur has been awarded at Rs 5,080 crore in March 2015. One more contract of electrification between Rewari and Vadodara was awarded in November 2014 for Rs 4,000 crore. Thus, so far civil contracts for 66 per cent of the length have been awarded in the eastern corridor and 43 per cent in the western corridor.
It is further planned to award 85 per cent of the contracts by March 2016 and the balance 15 per cent by June 2016.
How confident are you of meeting the deadline of December 2019?
We are fully geared up. We are pursuing the acquisition of the balance 16 per cent of the land and fixing the contracts for all works, including civil, electrical and signaling and telecom. The progress of the on going works is being monitored at the managing director’s level on a daily basis. We will surely complete the entire EDFC and WDFC by 2019. Phased commissioning of DFC will start from 2018.
How would the project change the freight transport scenario?
DFC will be a game-changer in the freight transport sector. A freight consignment today takes two to three to move between Delhi and Mumbai. After completion of DFC, the time will be reduced to less than 24 hours. Thus, DFC will provide efficient, reliable and fast transport. This will help in improvement of railways’ share in transport from 36 per cent. WDFC will involve movement of double-stack containers with electric traction for the first time in the world. The average speed of trains will increase to 70 km per hour against 25 km per hour now. The unit cost of transport is also expected to reduce 40 per cent making DFC more economical than other modes of transport.
What is the progress of the project?
The DFC project has gained momentum and there is significant increase in the progress of work in the Rewari-Iqbalgarh section of the western corridor (WDFC) as well as in the Khurja-Bhaupur section of the eastern corridor (EDFC), despite several land constraints. Funding for both the corridors has been tied up, except for the Khurja-Ludhiana section of the eastern corridor, for which negotiations with the World Bank are on. Securing land and tying up funds are the two most crucial steps for any infra project, followed by the award of the contracts and monitoring the progress. We are currently working on all the four stages simultaneously. Of the total 3,350 km of the DFC project, work is in progress in 360 km in EDFC and 650 km in WDFC. Civil contracts have been awarded for the Kanpur-Mughalsarai section of EDFC during March 2015.
What is the progress on land acquisition? How would the talks on the land Bill impact the project?
Acquisition of land is the first requirement. DFC is a linear project of more than 3,300 km; 10,537 hectares have to be acquired. So far, 8,874 hectares have been acquired, 84 per cent of the land requirement, excluding the Sonnagar-Dankuni section (on PPP basis). There are patches of land yet to be acquired, affecting 245 km in the eastern corridor and 113 km on the western corridor. The matter is being vigorously pursued with the state governments. Most of these patches are in Uttar Pradesh, Bihar, Gujarat and Maharashtra. Acquisition of balance 16 per cent is certainly an area of concern as the provisions of the new land acquisition Act will apply soon.
What is the latest cost estimate for the project and how much of funding has been tied up?
The total cost of DFC is Rs 81,460 crore, excluding the Sonnagar-Dankuni section being built on private-public partnership mode. Of the total, two-thirds was arranged via debt and the rest via equity of the rail ministry. EDFC is funded by the World Bank. WDFC is funded by Japan International Cooperation Agency (JICA). The World Bank will provide $2.72 billion. Agreements have been signed for two loan components for $2.10 billion. The second loan agreement was signed in December 2014. JICA will provide loan of 645 billion yen. Expenditure till April 2015 is Rs 13,250 crore, including land.
What is the progress on placement of contracts?
The process of fixing contracts was initiated after tying up the funds and achieving at least 75 per cent progress in land acquisition. Contract for Rs 4,000 crore were awarded during 2013 in the Khurja-Kanpur section of EDFC. Similarly, contracts for Rs 7,000 crore were awarded between Rewari and Iqbalgarh during August 2013. After tying up funds for EDFC-2, recently a contract for Khurja-Kanpur has been awarded at Rs 5,080 crore in March 2015. One more contract of electrification between Rewari and Vadodara was awarded in November 2014 for Rs 4,000 crore. Thus, so far civil contracts for 66 per cent of the length have been awarded in the eastern corridor and 43 per cent in the western corridor.
It is further planned to award 85 per cent of the contracts by March 2016 and the balance 15 per cent by June 2016.
How confident are you of meeting the deadline of December 2019?
We are fully geared up. We are pursuing the acquisition of the balance 16 per cent of the land and fixing the contracts for all works, including civil, electrical and signaling and telecom. The progress of the on going works is being monitored at the managing director’s level on a daily basis. We will surely complete the entire EDFC and WDFC by 2019. Phased commissioning of DFC will start from 2018.
How would the project change the freight transport scenario?
DFC will be a game-changer in the freight transport sector. A freight consignment today takes two to three to move between Delhi and Mumbai. After completion of DFC, the time will be reduced to less than 24 hours. Thus, DFC will provide efficient, reliable and fast transport. This will help in improvement of railways’ share in transport from 36 per cent. WDFC will involve movement of double-stack containers with electric traction for the first time in the world. The average speed of trains will increase to 70 km per hour against 25 km per hour now. The unit cost of transport is also expected to reduce 40 per cent making DFC more economical than other modes of transport.