Planning Commission pitches for management overhaul of Railways

The Planning Commission has criticised the Railways for failing to attract private sector participation in its multi-crore infrastructure projects and has called for overhauling its management to allow "relevant experts" to be part of its decision making process.

In its comments to a recent Cabinet note moved by the Railways to promote participatory models for rail connectivity and capacity augmentation, the commission argued that for the past two years the country has attracted the highest public private participation (PPP) but the railways have not been a part of this success story.

"Although successive railway ministers during the past seven years have announced increasingly ambitious plans to attract PPP investments, the progress so far has been negligible. This is primarily due to lack of institutional capacity and processes within the railway ministry. This requires some institutional restructuring coupled with access to relevant experts," the Commission observed in its note.

The apex planning body said it is imperative for the railway ministry to build dedicated capacity within the Railway Board to structure, process and award PPP projects.

In reply the Railways conceded that the "lack of organisational capacity and weaknesses in the internal decision making process would need to be addressed" if big ticket PPP projects like high speed rail corridors and re-development of stations are to be executed.

A source in the railways ministry said that about 100 projects have brought about a cost overrun of nearly Rs 55,000 crore (about 150 per cent) in total, besides sustaining years of delays.

The estimated resources required by Railways during the 12th Plan is to the tune of Rs 5,19,221 crore including gross budgetary support of Rs1,94,221 crore, internal and external budgetary resources of Rs 2,25,000 crore and private sector investment of Rs 1,00,000 crore.

Currently the railways has 347 ongoing projects under new lines, gauge conversions and doubling tracks entailing an investment of about Rs 1.47 lakh crore.

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