Railways looks to get monetisation proceeds on track with Rs 17K cr goal

Ministry may generate revenue by leasing out land parcels belonging to Indian Railways

The Ministry of Railways is looking to increase its monetisation of assets this financial year, seeking to better its weak performance on this count. The railways has identified assets worth Rs 17,000 crore for 2024-25, according to officials privy to the developments.

The ministry seeks to generate revenue from the private sector by leasing its land parcels, station land for commercial purposes, and railway colonies, a senior government official said.

The ministry is likely to submit this as its annual target to the NITI Aayog, which heads the monetisation exercise.

According to another official, a meeting on the asset-monetisation target will be held later this month.

In proportionate achievement of the target, the railways is among the worst performers in national asset monetisation plans.

According to officials, the ministry has achieved monetisation of about Rs 21,000 crore against a target of around Rs 68,000 crore given by the NITI Aayog.

The target for the ministry, according to the National Monetisation Pipeline (NMP), released in 2021, was Rs 1.2 trillion by 2023-24. This has been revised downwards over the years after the railways repeatedly slipped up on targets.

In 2024-25, the original NMP pegs railway monetisation proceeds at Rs 32,557 crore.

Initially, the central think tank had expected half the ministry’s proceeds to come from monetising railway stations, with redevelopment projects to be in public-private partnership (PPP) mode.

The railways had received a significant market interest in station monetisation projects, with infrastructure giants such as Adani Railways, GMR Highways, Godrej Properties, and Oberoi Realty in the running for big-ticket projects like the Chhatrapati Shivaji Maharaj Terminus (CSMT) and New Delhi Railway Station.

However, tenders were scrapped due to the shutdown of a railway special purpose vehicle (SPV).

The Union Cabinet in September 2022 had approved a Rs 10,000 crore plan to redevelop three mega stations from the Centre’s own coffers.

The same year the Cabinet had approved the proposal to lower the land licensing fee (LLF) for industrial use of railway land to make these parcels more attractive for freight operators and other industries.

Under the original NMP, assets under consideration for monetisation include trains, track overhead equipment, goods sheds, hill rail, and stadiums. Meanwhile, the ministry has been asked to expedite transaction rollouts for other assets.

According to the NMP, close to Rs 40,000 crore was supposed to be raised from an infrastructure investment trust (InvIT) of track overhead equipment, and monetising passenger trains.

The ministry has since decided it would not privatise train operations.

Initial discussion on the matter had brought out complications in separating the operations of overhead equipment from the rest of railway infrastructure, with the transporter keen on keeping operational control of the assets.

Queries sent to the ministry on Friday did not get a response till the time of going to press.