 "Platform modernisation gets underway")
It was Mamata Banerjee who first came up with the idea of changing the face of stations in her railway budget speech of 2009-10 when she lined up for redevelopment 50 world-class stations through innovative financing and public-private partnership. However, the plan made no headway till Suresh Prabhu took charge of the railways ministry some two-and-a-half years ago.
“Besides improvement in service, a redeveloped railway station would also provide opportunities for generating significant non-tariff revenues,” Prabhu said during the initial days after taking charge. He talked of upgrading no fewer than 400 stations — eight times the number touted by Banerjee.
However, it was only in July 2016 that the first contract to redevelop and redesign the Habibganj (Bhopal) Railway Station was awarded to the Bansal group. The estimated cost of redeveloping Habibganj is Rs 100 crore, while that of the commercial development is approximately Rs 350 crore.
The Indian Railway Stations Development Corporation (IRSDC), which is entrusted with the task of the re-development, has next lined up Surat (Gujarat), Anand Vihar and Bijwasan (both in New Delhi) for a similar facelift.
The airport-like makeover of railway stations has now gathered further pace with several large construction companies showing interest in the Anand Vihar and Bijwasan projects.
“Each of these 400 stations would see an average investment of at least Rs 100 crore. Though only three companies had shown interest in Habibganj, about 13 players have been shortlisted for Anand Vihar and nine are in fray for Bijwasan,” says an officer of the Indian Railways who is close to the development.
The companies which are in the race for these two stations include the Tata group, Shapoorji Pallonji, GMR, Essel group, L&T, IL&FS, McNally Bharat, Supreme Infrastructure, Oriental Structure, Bhartiya group, MBL Infrastructure, ASF Infrastructure, Bansal Constructions, Bharti Realty, Ahluwalia Construction and IRB Infra.
Meanwhile, Habibganj, spread over 1.1 million square feet, is expected to be ready by November 2019. According to the agreement with the Bansal group, the company will get advertising rights and proceeds from ticket sales and also the right to keep the commercial property for 45 years. For Surat, IRSDC has sweetened the deal, through which the commercial developer will get a 90-year lease.
IRSDC has also been entrusted with stations like Chandigarh, Gandhinagar, Shivaji Nagar (Pune) and SAS Nagar (Mohali), apart from Habibganj, Surat, Anand Vihar and Bijwasan. “The entire cost of re-development is to be met by leveraging the commercial development of land and air space in and around stations. The revenue streams to be given to the players include parking, catering and small retails,” the official adds.
Grand plans
The Indian Railways’ master plan says a redeveloped station would be like a multi-model transit hub, including facilities like separate entry for arrival and departures, clean waiting halls and toilets, executive lounges, shopping complexes, movie halls, restaurants and offices, with most stations having at least three levels and provisions to park at least 1,000 vehicles.
To speed up the process, in August, the Indian Railways appointed global consulting firm The Boston Consulting Group as a strategic adviser: it would carry out studies on the feasibility and financial viability of all the stations up for redevelopment.
The excitement is palpable. “Now, railway stations will be of international standards. These stations will have huge commercial centres and malls, even cinema theatres. Even IRCTC has requested the ministry of railways to participate in the upcoming projects,” says IRCTC chairman and managing director A K Manocha.
Not just Indian corporations, even foreign countries are in race to get a slice of the business which would run into billions of dollars. The railway ministry is in talks with countries like the UK, France, Spain and China to be a part of the station makeover project, taking it up station-wise or in clusters. For the first phase of redevelopment of 400 stations and logistic parks, the Indian Railways are expecting an investment of about Rs 1 lakh crore.
“As of now, we have zeroed in on eight stations covering an average area of about 800,000 square feet for re-development in the initial stage. Some state governments like Rajasthan, Madhya Pradesh, Karnataka and Maharashtra, and certain public-sector undertakings have shown interest in participating in the projects, where the rate of returns in commercial projects will be comparatively low,” the Indian Railways officer adds. It is expected that in those stations, where the rate of returns is projected low, the interests of companies will be minimal.
IRSDC is in the process of preparing a feasibility plan for the development of the Baiyyappanhalli (Bengaluru) station along with the Karnataka government. In addition to this, the Narendra Modi government will also try out the “Swiss challenge method” for the first time in India in the upcoming station development projects. According to this, a development proposal submitted by one party will be made available online and a second party will get the chance to improve this plan and submit a fresh one. If the first party fails to match the counter proposal, it will be awarded to the second party.
In addition to this, Prabhu also has a plan to rope in the World Bank for funds to develop stations on its own, without involving private developers. A $5-billion fund for redevelopment of railway stations, with support from the World Bank, is reportedly under consideration.
“We hope by 2022, at least these eight stations will be sporting the new look of Indian railways, if projects go as per plan,” the officer adds.
Going Forward
- Separate entry for arrivals and departures
- Clean waiting halls and toilets
- Executive lounges
- Shopping complexes
- Movie halls
- Provision to park at least 1,000 vehicles
