Railways may raise Rs. 5,500 cr as revenue by leasing its land | delhi | Hindustan Times
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Railways may raise Rs. 5,500 cr as revenue by leasing its land

delhi Updated: Dec 02, 2012 23:06 IST
HT Correspondent
HT Correspondent
Hindustan Times
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Rail Land Development Authority (RLDA) vice-chairman Pankaj Jain is upbeat these days. Reason: government restrictions on obtaining prior approval of the cabinet secretariat before leasing out government land have been relaxed. In the midst of firming up bid documents for the award of major contracts, Jain shares his plans with Srinand Jha. Excerpts of the interview:

Restrictions on the leasing of rail land have now been removed. So, what are the RLDA's targets now?
Until March 2011, when instructions were issued that cabinet approval was mandatory for the leasing of all government land, the RLDA had finalised contracts with a total lease premium of Rs 1,780 crore. These restrictions were removed on August 12 this year.

The potential of earnings through lease of railway land is estimated at Rs. 5,500 crore. So, we will begin awarding contracts within this fiscal. I can say that the RLDA is now at the take-off stage.

How much railway land is available for commercial exploitation and how do you plan to go about it?
The railways transferred 136 land parcels (totalling 1500 hectares) to the RLDA. After surveys and studies, we have found that only about 52-53 parcels (approximately 800 ha) are commercially viable. The remaining land is either barren; units are very small or are located at places that are not commercially viable.

The RLDA is in the process of finalising bids to offer the commercially viable land on lease to private parties.

The much-publicised plan of setting up multi-functional complexes (MFCs) does not seem to have taken off…
The plan is rapidly moving forward. Of the total of 140 MFCs that are to be built, the RLDA will be floating bids for 40 locations shortly. Major players, including Pantaloons, Café Coffee Day and the Wheeler and Company have evinced keen interest in participating in the bids. Hospitality groups such as the Krishna Palace and Apodis Hospitality are also interested in building budget hotels on our land. These things will start moving within the next few weeks.

Twelve sites for development of MFCs have been identified for this year and bids for 56 other sites will be floated in the next financial year.

With the setting up of the station development authority, the functions and role of the RLDA are appearing to have become restricted. Is there some overlapping of roles between these two organisations?
The mandate of the station development authority is to develop the station area. The RLDA's functions are to provide for commercial development of surplus rail land in the vicinity of the stations. The roles are clearly defined and there is no overlapping. In any case, the RLDA has a 49% equity partnership in the station development authority.

So, is the station development plan likely to move forward in the foreseeable future?
Quite certainly. Global bids will shortly be invited for pre-feasibility studies and tenders will be called for architects.

Five stations, including Bijwasan (Gurgaon, Haryana), Chandigarh and Shivaji Nagar (Pune, Maharashtra) will be taken up in the first phase as pilot projects.