Gujarat govt is set up a railway company on PPP basis

The Gujarat Government plans to set up a new special purpose vehicle (SPV), a railway company to be formed on the public-private partnership (PPP) model, to connect the various industrial hubs with important railway stations and facilitate faster and smoother movement of manufactured goods through cost-effective transportation.

The dedicated rail network is also expected to reduce the burden on roads.

State-promoted companies such as the Gujarat Industrial Development Corporation and the Gujarat Industrial Corridor Company (GICC) would invest in the SPV, which will have the Delhi-Mumbai Industrial Corridor Development Corporation (DMICDC) and the Indian Railways as partners.

The state government has entrusted DMICDC to commission an agency for drafting a project report. It will invite expressions of interest (EoI) in the next couple of months. The quantum of equity to be invested by the SPV partners would be decided thereafter.

Early reports suggest that the SPV may invest around Rs 4,000 crore on the project in the next three years, when it is expected to be commissioned. The partners are likely to fork out nearly Rs 10 crore each initially as promoters’ share to set up the company and raise more funds thereafter for the project.

The new network would link industrial clusters such as Sanand, Vitthalpur, Godhavi and the upcoming Mandal-Bahucharaji, as also DMIC and the Dedicated Freight Corridor (DFC), with various industrial parks, transportation hubs and logistics centres to reduce costs and ensure the hassle-free transportation of goods.

Source: HBL