SPV for gauge conversion between Surendranagar and Bhavnagar

SPV for gauge conversion between Surendranagar and Bhavnagar
PRESS TRUST OF INDIA

NEW DELHI, SEPT 23: Government today approved a Special Purpose Vehicle (SPV) for carrying out gauge conversion between Surendranagar and Bhavnagar and its extension to Pipavav Port in Gujarat to establish rail link with the rest of the country.

Pipavav is the first private sector Port to be established in the country, and is expected to handle three million tonnes of cargo initially and eventually up to 10 million tonnes in five years.

The SPV, approved by the Union Cabinet, will carry out the Rs 294 crore project which involves gauge conversion of 250 kms distance between Surendranagar and Bhavnagar and a 14 km extension to Pipavav to establish the rail link with the Port, Parliamentary Affairs Minister Pramod Mahajan said.

The project will be financed with debt-equity ratio of 1:2 whereby both Ministry of Railways and Gujarat Pipavav Port along with their associates will hold 50 per cent each of total equity. This will be the first joint venture of its kind whereby a railway broad gauge conversion project will be executed.