Govt considers privatisation of 90 railway stations, mulls airport-like security infra
The Indian Railways is considering having private companies operate 90 train stations and is exploring several options – including looking at the arrangements at India’s privately run airports – to determine how best to set up the security infrastructure at these.
Railways, which runs the fourth-largest such network in the world, set the ball rolling in 2019 on letting private companies run and operate certain stations in a public-private partnership (PPP) model. The move, steered by the Indian Railway Stations Development Corporation (IRSDC) is expected to help significantly modernise parts of a decades-old system.
The Railway Board, in a letter reviewed by HT, sought the opinion from all principal chief security commissioners of the Railway Protection Force (RPF) and all zonal railways on how the security infrastructure for the 90 stations should be set up.
One of the options, it noted in the letter, would be to replicate the airports’ model where the Central Industrial Security Force (CISF) – a government paramilitary unit – is contracted by the operator, which pays their salaries.
“The airport operators not only provide and maintain the security infrastructure and equipment at the airports, but also pay for the salary and wages of the CISF personnel deployed there. Therefore, the complete cost of providing security at the airport is borne by the airport operators Therefore, Security Directorate has to take a view on how the security infrastructure, equipment, etc will be provided and maintained at a station under SFM. We may also examine if the airport model may be replicated or otherwise,” it added.
According to the letter, a committee examining these details has suggested that security and access control services (barring maintenance of assets that enable them), should be kept out of the agreement with the private companies. SFM refers to the Station Facility Management that will come up following the agreement.
The letter enumerated two more options that may be considered by the Security Directorate: In one of them, the SFM bears “the responsibility of provision and maintenance of security infrastructure and equipment along with the cost of manpower including (RPF 50% Government Railway Police)”.
In the other option, it noted that this responsibility may be borne by the Railways instead.
The railway board has sought these inputs by March 15.
In October 2019, the government decided to set up a committee to draft a blueprint for transferring the operations of 150 trains and 50 railway stations to private firms. Niti Aayog CEO Amitabh Kant in a letter to then railway board chairman VK Yadav stated that an empowered group be formed to “drive the process” in a time-bound manner.
“Approaches to provision of security services in infrastructure has always been a contentious issue. Initially under the airport model (Delhi and Mumbai Operation, Management and Development Agreements) the provision of security services was retained with the state, however later models provide for security infrastructure to be maintained by private parties as well,” said Deepto Roy, partner, Shardul Amarchand Mangaldas & Co.
“The key principle of PPP is that the party most suited to take a risk and perform an activity should be entrusted the responsibility for that activity - this is in line with the Kelkar committee recommendations as well... given the complexities of railway security, the responsibility should be retained ideally by the government — with costs met from the revenue share. If this is not possible - significant oversight of SFM security services should be put in place,” he added.
In September, the ministry said it opened the Request for Qualification process of the bidding for eight railway stations: Nagpur, Gwalior, Amritsar, Sabarmati, Nellore, Puducherry, Dehradun and Tirupati. “Private developers have shown interest and accordingly, RFQ applications for all 8 stations have been received,” the ministry said at the time.
Work has also begun on the redevelopment at Gandhinagar and Habibganj and awarded contracts for redevelopment of Anand Vihar (Northern Railway), Bijwasan (Northern Railway) and Chandigarh (Northern Railway) railway stations.
Railways also decided to start levying an additional fee on train fares across its redeveloped stations. The user development fee is similar to what airports charge and will be used by the national transporter for the first time.
Indian Railways also plans to introduce private trains on its network in phases, with the first dozen due to start running in the 2023-24 financial year and all 151 by 2027.