Railways, NBCC ink MoU to redevelop 10 railway stations

Rail Land Development Authority (RLDA) has inked MoU with National Building Construction Corporation (NBCC) for redevelopment of 10 railway stations across the country on global standards.
The identified stations to be taken up initially by NBCC, a PSU of Urban Development Ministry  for redevelopment are Tirupati, Nellore, Puducherry, Sarai Rohilla (Delhi), Madgaon, Lucknow, Gomtinagar, Kota, Thane (New) and Ernakulam.  RLDA is an arm of the Indian Railways for commercial exploitation of rail land.

Key Facts

As per the MoU, a Special Purpose Vehicle (SPV) will be formed at the national level as a Joint Venture (JV) company between RLDA and NBCC on 50:50 shareholding basis. The SPV in turn will enter into City Support Agreements (CSA) with respective cities for the redevelopment of stations and commercial development on Railway land in alignment with the Smart City Plans of respective cities.
RLDA will lease out the land to the SPV for a fixed lease period of up to 45 years at a nominal token cost for development and NBCC as Project Management Consultant will execute the project work on behalf of SPV.
Earnings from the commercial development of land parcels at stations will be utilized to redevelop the stations for creating necessary infrastructure and better passenger amenities. The surplus earnings will go to RLDA which would in turn would be remitted to Zonal railways.
The entire revenue from lease revenues from built up spaces will be deposited in an SPV’s ESCROW account which is to be managed by a Committee to be formed.

Background

The Indian Railways has embarked on an ambitious project to redevelop 403 stations with the participation of private players, public sector and foreign agencies. It has taken up this redevelopment programme of stations in a big way by adopting a multi-pronged strategy. It has chosen PPP model and is also roping in varied agencies to execute the project namely its own PSUs, other Central government PSUs, foreign countries through government-to-government (G2G) cooperation and state governments. Earlier in October 2016, MoU was also signed between the Railway Ministry and Urban Development Ministry for integrated planning for redevelopment of railway stations in the cities included in the Smart Cities Mission and AMRUT schemes.

Month: Current Affairs - July, 2017