Freight corridor SPV to get MD on May 15

The appointments committee of the Cabinet will finalise the managing director of the Dedicated Freight Corridor India Ltd (DFCIL), the SPV formed for the dedicated freight corridor project, on May 15. The last date of receiving names for the post is April 25.

Though the SPV was formed on October 30 last year, it has not started functioning formally as it does not have an administrative head.

The SPV has been formed for funding, running and maintaining the rail freight corridor, which envisages parallel tracks alongside the Golden Quadrilateral (GQ) routes for decongesting the existing tracks. The idea is to create a separate network for freight trains.

The committee, headed by the Cabinet Secretary BK Chaturvedi, is looking for a person who has handled mega railway projects.

The Rs 60,000-crore project consists of four major stretches ""Delhi-Howrah, Delhi-Mumbai and Mumbai-Chennai and Chennai-Howrah. Of these the Delhi-Howrah and the Delhi-Mumbai stretches have been cleared by the Cabinet. Both these corridors would cost the railway ministry around Rs 30,000 crore.

The SPV, which is 100 per cent owned by the railway ministry, plans to raise funds for the project through market borrowing or through interest-free loan from the railway ministry.

The railway ministry had also negotiated with the Japanese transport and finance ministries for a loan of Rs 22,000 crore, especially for the two cleared stretches. The loan ""yet to be approved by the Japanese government "" will have a 40 year repayment period, and will carry 4 per cent interest.

The ministry may rely on it in the long run, considering there could be cost overruns with the physical work on the project "" due to start in 2005 "" yet to take off. The survey work for the project only started last week.