The Public-Private Partnership (PPP) model, first for the Railways, may have many features which will be first of its kind in the country.
When Railway Ministry's proposal to invite private players for operating trains on selected routes bears fruit, there may be some new services and surprises for passengers as well. The Public-Private Partnership (PPP) model, first for the Railways, may have many features which will be first of its kind in the country.
Among such features will be preferred seats. Like airlines, these private operators will offer preferred seats for an additional cost. Passengers opting for privately operated trains in coming years may have to pay for preferred seats, just like in airlines. Not just the preferred seats, passengers may even end up paying for any add-on services like wi-fi, onboard entertainment and others.
Though, the decision to charge for these services will be entirely in the hands of private players.
The Ministry of Railways last week invited Request for Qualifications (RFQ) for private participation for the operation of passenger train services over 109 Origin-Destination (OD) pairs of routes through the introduction of 151 modern trains.
Indian Railways has come up with a set of conditions for its project offering some routes and trains to private players. DNA has accessed the set of conditions for private players wishing to enter as operators for train services.
The Railways may give private players the freedom to fix the fares for the trains they are operating. Private players will also have the freedom to explore areas of new avenues to generate revenues.
The proposed project for private players to operate trains in Mumbai (Cluster-1) will go through a two-stage competitive bidding process between interested parties, based on the share offered in the Gross revenue of the project. Railways has clearly laid down conditions that a certain portion of gross revenue earned by the private player has to be shared.
Other factors appearing in the mandate prepared by Railways for private operators include the duration of the journey, length of trains, crew, safety certification, maximum speed and ticketing.
Duration of journey: The running time taken by a train from originating station to the destination station shall be comparable to the fastest train of Railways operating on the same route. No new similar scheduled train will depart the originating station in the same route within 60 minutes.
Length of Train: Each train shall have a minimum of 16 coaches and a maximum not exceeding the longest passenger train on the route.
Configuration of trains: To be decided as per the party based on demand.
Operation and Maintenance: Governed by standards and specifications and requirements given in concession. While Railways will allow usage of its maintenance depots, private parties will have to provide for manpower, tools and plants as required. The scheduled maintenance of the trains shall not be before 31 days or travel of 40,000 kms of such previous scheduled maintenance, whichever is later.
Crew: Driver and Guard required for the operation of the train shall be provided by Railways but will have to be trained by private parties.
Safety Certification: Shall be done by Railways based on its own safety parameters.
Concession Period: Will be for a period of 35 years commencing from the Appointed Date.
Maximum Speed: Trains to be designed to operate at a maximum speed of 160 kmph.
Fare: The Private Entity shall have the freedom to decide on the fare to be charged from its passengers.
Ticketing: The private entity shall use the existing Indian Railway Passenger Reservation System for booking of tickets.
In addition to the conditions laid down by the Railways for private players, private players will have to pay a fix and predetermined haulage charges and charges for energy consumed. Private player will also have to pay penalties for poor performance.
Private companies will have a choice to procure trains and locomotives from a source of their choice complying with Railways' standards. However, the Concession Agreement would include provisions relating to mandatory sourcing via domestic production in India over a period of time.
Railways has set a target to run the first private player operated train by April 2023, Railway Ministry has called the first pre-bid meeting for the project on July 21. Essel Group, Adani Group, RK Associates, Alstom, Bombardier and many other big names have already shown keen interest in the project.
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