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Private developers show interest in redeveloping 8 stations

Several private developers have shown interest in redeveloping 8 railway stations for which Request for Qualification was invited. This information was given by the Railway Minister, Shri Piyush Goyal in a written reply in the Rajya Sabha yesterday. It may be recalled here that recently, the Indian Railways had invited Request for Qualification (RFQ) for redevelopment of eight railway stations viz. Nagpur, Gwalior, Amritsar, Sabarmati, Nellore, Puducherry, Dehradun & Tirupati on Public Private Partnership (PPP) mode. According to the Minister, private developers have shown interest and accordingly, RFQ applications for all 8 stations have been received.

The Minister also informed the House that work of redevelopment is in advanced stage at Gandhinagar (Western Railway) and Habibganj (West Central Railway) railway stations. Re-development works are in progress at Gomtinagar (North Eastern Railway) and Ayodhya stations (Northern Railway). Contracts have been awarded for redevelopment of Anand Vihar (Northern Railway), Bijwasan (Northern Railway) and Chandigarh (Northern Railway) railway stations.

Station redevelopment is planned by leveraging real estate potential of sparable land and air space in and around the stations, through private participation. The selection of developer is done following a transparent and competitive bidding process.

Indian Railways plans to redevelop 600 stations, entailing an investment of about Rs. 1 lac crore. Initial progress on this front has been slow due to muted response by industry players for the proposed PPP model to develop stations. However, a study initiated by the FICCI Capital Goods Committee points out that the recently introduced changes are expected to provide a fillip to developments. These changes include appointment of nodal agency for station redevelopment (Indian Railway Stations Development Corporation or IRSDC), longer lease periods of up to 99 years for developers, allowing multiple sub-leasing, allowing residential development, and simplified bidding procedures. IRSDC is planning to tap investment from private equity investors and pension funds for the initial pool of 10 stations, totalling to about Rs. 2,500-3,000 crore.

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