The government is likely to extend sovereign guarantee to the bonds issued by the Indian Railways Finance Corporation (IRFC), making it easier for the financial arm of Indian Railways to borrow desired funds from the Life Insurance Corporation of India (LIC).

“We are in talks with the finance ministry. The outcome is likely to be positive. The sovereign guarantee will help us raise desired funds from LIC through bonds,” said SK Pattanayak, Managing Director, IRFC.

“We were to raise Rs 30,000 crore annually as the investment demand from the railways was also high but couldn’t since both the Insurance Regulatory and Development Authority of India (IRDA) and LIC sought a sovereign guarantee,” he said.

Indian Railways had signed a memorandum of understanding in March 2015 with the state-run insurer to seek Rs 1.5 lakh crore over a period of five years through bonds issued by the IRFC.

The IRDA in turn sought an explicit government guarantee for the bonds because it wanted to ringfence the funds that belonged to lakhs of insurers. The insurance regulator also sought special status for the bonds.

Against the target of raising Rs 30,000 crore annually from the LIC, in the past three years the IRFC has been able to raise only Rs 16,500 crore. In November last year, the finance ministry issued an order saying that the IRFC bonds could be treated as approved security for investment above the exposure limits.

The proposed Rs 30,000 crore a year investment would increase the LIC’s exposure to more than 25% of the IRFC’s net worth, well above the limit the insurer is allowed in any company involved in infrastructure.

It did not offer any government guarantee on the bonds but said the bonds were covered by Section 2(3) of the Insurance Act, under which the repayment is charged on the revenue of the railways ministry.

“Even after that the matter couldn’t be resolved as the IRDA insisted on sovereign guarantee. We are hoping to raise Rs 26,400 crore from LIC in the next fiscal after the government guarantee is received,” Pattanayak said.

If the LIC were to invest in the bonds, the cost of borrowing would reduce for the railways. The LIC funding is for a period of 30 years, with a five year moratorium on interest and loan repayment, and the rate would be linked to the 10-year benchmark (G-Sec yield) plus 10 basis points (0.1 percentage points).

“We have also requested the finance ministry not to levy any fee for granting the sovereign guarantee status as it would increase our borrowing costs,” the IRFC MD said.

The national transporter has planned its highest ever capacity expansion programme for the next financial year, with a total investment nearing Rs 1.5 lakh crore, of which around Rs 50,000 crore would come through extra budgetary resources including market borrowings and LIC funding.

Traditionally, the IRFC has been sourcing low-cost finances for railways. The funds raised by the corporation are used to acquire rolling stock and funding projects. The assets are owned by the IRFC but leased to the railways for a fixed fee

If you resent the services of Indian Railways that boasts of a vast network of 67,368 kms, and want to really do something about it instead of merely grumbling, then you can send a strong workable solution to the government of India and get paid for it, and handsomely though.

Name of the competition is ‘How to Raise Money For Railways To Provide Better Services‘.

Indian Railways runs 13,329 passenger services daily catering to 22.24 million passengers.

The Indian Railways competition guidelines stipulate that one can send some practicable ways to raise money to help it improve services. And the good ideas stand to get huge cash prizes.

Winner of the first prize stands to receive Rs. 10 lakh. The second prize winner will receive Rs. 5 lakh. The third prize winner will be bestowed with a sum of Rs. 3 lakh, while the fourth prize draws a sum of Rs. one lakh.

HIGHLIGHTS

10 THINGS TO KNOW

1. To be able to post the entries using the online application system, one should visit https://innovate.mygov.in where one has to click the “click to participate” button. The participant will be taken to a landing page featuring the registration form with various fields.

2. The participants will have to fill out a registration form and entry submission form. The submission should comply with the requirements as set out in the Guidelines mentioned on the online Entry Submission Form.3. On successful submission, participant will receive a confirmation email. For any queries you can even email to ps07@nair.railnet.gov.in

4. The idea for improving the revenue of Indian Railways must be written in a maximum of 1,000 words while the abstract should be written in about 250 words. Any attachment, such as a PDF file or any power point presentation, can be sent as an attachment but should not exceed 8 MB in size. Value proposition to customers and relevance of the concept/ design in enhancing the customer experience has to be written in 150 words. Compliance to the boundary conditions has to be encapsulated in 250 words. The originality of proposed idea must be written in 150 words. The project’s cost effectiveness has to be written in 200 words and possible constraints must be listed out in another 150 words.

5. Indian Railways gives a backgrounder for the idea. The railways ministry concedes that gross revenue of Railways was Rs. 1,65,292 crore while working expenses for the year was Rs.1,59 lakh crore. The government has made an observation that the railways revenue has been almost stagnant for past four years, whereas the working expenses have been rising steadily. This has caused fall in investible surplus of Railways, thus affecting quality of services.

6: The Indian Railways competition is open to individuals and companies/ institutions.

7. The deadline to submit duly filed form is 6 pm of May 19.

8. The write-up can be submitted in Hindi or English.

9: To be able to judge an idea’s worth, 30 percent weightage would be given to viability of project, 20 percent to revenue potential, 10 percent to customer convenience, 10 per cent to scalability, 10 per cent to cost effectiveness, 10 per cent to compliance of boundary conditions, 5 per cent to detail orientation and the rest 5 percent to quality of presentation.

10. Any communication with a participant will be done through an email provided by the participant at the time of filling the application form.

In a period of less than one year, from April 2017 to February 2018, the Indian Railways has earned a ‘bonus’ income of Rs 1,097 crore from penalties imposed on ticketless travellers, with approximately Rs 200 crore being earned per month.

In the April to February period, around 3 crore people were caught travelling without ticket, apart from those travelling with tickets in others names, and adults travelling on half-tickets.

“We are making it more and more difficult to travel ticketless,” Railway Board Member Traffic Mohammad Jamshed said.

“This is a huge amount of money realised from offenders caught through intense checking drives,” he added.

Large numbers of ticket-checking staff along with security forces and CCTV coverage at major stations conducted the drives as well as “ambush checks” and “fortress checks” to catch ticketless travellers.

In comparison, to earn Rs 200 crore a train like the Mumbai Rajdhani would be required to run on full occupancy for all trips for a whole year. The extra earnings of Rs 1,000 crore is typically the amount that the Railways would spend to lay 70 km of new lines.

Since the ‘flexi fares’ concept was introduced 2 years ago, which modulates the price of train fare in a dynamic system based on demand in premium trains, the Railways has earned an extra Rs 600 crore per year. However, after the merger of the Railway Budget with the General Budget, the extra money now goes to the Finance Ministry.

The railways has decided to develop major railway stations from its own money after it failed to get a good response from private investors for its Public Private Partnership (PPP) model.

“The national transporter will develop 68 major railways stations under Engineering Procurement and Construction (EPC) mode. In the list, three railway stations from Karnataka Yeshwanthpur, Mysuru and Dharwad are also included,” said a railway ministry officials.

Under the EPC mode, the railway ministry will spend the money, contractors have to redevelop the stations and hand over to the ministry.

Instructions have been issued to Zonal Railway offices to start inviting tenders and complete the works with in a year. Redevelopment will ensure better passenger amenities including elevators, passenger rest room, drinking water facilities, modern electronic announcement, airport-like entry and exist systems, food courts and shopping complexes, said the official.

As per the estimate around Rs 4,000 crore is required for this project and the railway will spend from its own resources.

Though the government had earlier identified 100 railways stations for development with PPP model, so far only two stations Surat and Habibganj , in Bhopal, have been handed over to private investors for development.

Another 10 stations are being developed by National Building Construction Corporation, a state run company, said the official.

Soon, you may have to pay less to travel on a Shatabdi train — but only for a short trip. The Railways, with an eye to increase the occupancy in the last leg of the journey of a Shatabdi train, is considering a reduction in fare for that leg and has already put in place two pilot projects, according to an official of the Railways familiar with the projects.

On a trial basis, the Railways reduced the fare on the last legs of the Delhi-Ajmer and the Chennai-Mysuru routes. “The fare between Jaipur and Ajmer was brought down at par with the road transport fare while the fare between Bengaluru and Mysuru was also reduced. In the Jaipur-Ajmer leg, the occupancy did not change but in Mysuru, there was a decent jump in traffic so the scheme has been continued there. There is no proposal to reduce the fare for the entire journey…” said the official.

A similar trial reduction has been started for the New Jalpaiguri-Malda leg of the Kolkata Shatabdi and Ahmedabad-Baroda leg of the Mumbai Shatabdi, added the official. He also said a committee formed to review the flexi-fare scheme is likely to submit its report soon.

The move to lower fares is encouraged by the success of a pilot project launched on two routes last year. In one section, where the pilot scheme was implemented, the earnings went up by 17 per cent and passenger bookings by 63 per cent, the official said. The development comes at a time when the national transporter is facing flak over the flexi-fare scheme and the general contention that it has led to a spike in fares in Shatabdi, Rajdhani and Duronto trains.

The Railways runs around 45 Shatabdi trains and these are among the fastest in the country.

The Railways had last year launched a pilot project in two Shatabdi trains — one running between New Delhi and Ajmer and the other between Chennai-Mysuru to study the impact of lowering of fares. Under the scheme, the fares were reduced between Jaipur and Ajmer, and Bengaluru and Mysuru — the sections of the route which witnessed perpetual low occupancy.

“The move yielded positive results for us. What we did was we offered fares in these premium trains equivalent to bus fares plying on the particular stretch,” the official said.

In the case of the Shatabdi to Ajmer, he said, the occupancy was low between Jaipur and Ajmer as people preferred to travel by buses which offered more affordable fares. To attract passengers, the Railways decided to match the bus fare in the premium train and reduced the ticket prices to about Rs. 300 in this section.

Similar step was also taken in the Shatabdi train between Chennai and Mysuru. The fares were reduced between Bengaluru and Mysuru, resulting in 63 per cent growth in passenger bookings on this stretch between January and November last year compared to the corresponding period the previous year.

The official said the measures being adopted are part of an exhaustive exercise initiated by the Railways for optimum utilisation of resources. One such exercise is reducing the layover time of a train for introducing more services.

By reducing the layover time of trains, the official said, the Railways was now looking to run 100 new trains on shorter and longer routes. While 25 new trains have already been introduced, 75 more would be run within this year.

Layover time refers to the time a train remains stationed at the terminating or originating point. This time is being utilised to run the train on new routes, optimising the resources.

Recently, Railway Minister Piyush Goyal had announced that a detailed analysis was carried out about layover time and the results have helped railways identify the routes on which new services can be introduced.

Jaipur-Agra Shatabdi to be discontinued by North Western Railway

The Golden Triangle of India, i.e., Delhi-Jaipur-Agra, will suffer a setback as Jaipur to Agra tourists and domestic travelers will now be unable to board the Jaipur-Agra Shatabdi Express. North Western Railways (NWR) has decided to terminate the Jaipur-Agra Shatabdi Express after a massive dip in passenger bookings.

“From May, 1 onwards the train services would be terminated,” said Tarun Jain, chief public relations officer, NWR on Thursday. Sources close to NWR has said that the number of passengers has been steadily going down since a long time and, thus, the Jaipur-Agra and Agra-Jaipur Shatabdi services had to be terminated.

The train was quite popular among foreign tourists, as told by a Jaipur based travel agent, “Usually many tourists after landing in Delhi from their country used to visit Jaipur first. After a two-day halt in Jaipur, they used to go to Agra by Shatabadi Express. This is a major setback. There are other trains too for Agra, but the timing of train was suitable for everyone as it starts in the morning and took the passengers back to Jaipur after visiting Agra in the evening.”

A senior officer of NWR also said that the train could be re-started as Jan Shatabdi, which will have subsidized fares. The catering service could be removed from the train, and the fare will be reduced in order to run as Jan Shatabdi. The train is expected to have the same schedule as the Shatabdi.

Railway Minister Piyush Goyal congratulated South Central Railway (SCR) General Manager Vinod Kumar Yadav for achieving the challenging task of providing 100 per cent LED lighting on all the 733 Railway Stations on the Zone, thereby earning the coveted status of being the first Zone on Indian Railways to achieve the feat.

In a communiqué addressed to the General Manager, the Rail Minister expressed happiness that this initiative of SCR will result in saving 32 lakh units of electricity per year, resulting in a saving of Rs 2.70 crore per annum to the Zone.

The Rail Minister expressed confidence that the dedicated team of SCR officials will also finish the task of providing LED lighting of the balance service buildings and residential quarters on the entire Zone, to attain 100 per cent completion in these two segments too, much before the targeted date of June 30, 2018.

In a move that could offer huge relief to the congested Krantivira Sangolli Rayanna (KSR) and the Yesvantpur railway stations, work to construct the third coaching terminal at Baiyappanahalli has commenced. Trains can start and terminate here from December this year. The coaching terminal will be located 3 km away from the present Baiyappanahalli railway station. Trains will continue to stop here too.

According to senior railway officials of the South Western Railway Zone, three platforms will be constructed under the first phase of the project, the cost of which  has now been revised to Rs.150 crore from Rs.118 crore. “Three pitlines (maintenance work), three stabling lines (where trains will be parked) and one sick line (trains in a state of repair will be set right here) are being built under this phase,” a top official said. “Work on construction of pitlines and platforms has started presently. All the infrastructure is expected to be in place by December 2019,” he added. Ticket issuing counters and all other infrastructural facilities required to start trains here will be set up.

The coaching terminal will come up on 20 acres of railway land, another official said. Except trains heading towards the Mysuru direction, there is a possibility of trains going in all other directions to arrive and depart from Baiyappanahalli.“When the terminal is ready, it will ease much of the pressure on City railway station from where 142 trains depart on a daily basis and Yesvantpur from where 95 trains depart daily. The decision on the specific trains that can arrive and depart here will be taken later,” said divisional railway manager, Bengaluru railway division R S Saxena.

When the Second Phase, which is slated for December 2019 is completed, the station will have seven platforms, another official said.The Ministry of Railways had also declared Baiyappanahalli as a Model Railway station. “After we complete our work or even simultaneously when our work is on, the Centre will work towards upgrading the railway station as a world class railway station,” the official said. The operational aspects will be put in place by the SWR while the Centre will take care of all the aesthetics aspects.

Western Railway’s Ro-Ro service trial between Roha to Karambali Goods Shed by the Mumbai Division was successful on 24^th March, 2018. A total of 3 trucks (1 empty wagon) started from Roha at 5.38 hrs and arrived at Karambali at 12.25 hrs via Vasai Road station.

According to a press release by Shri Ravindar Bhakar – Chief Public Relations Officer of Western Railway, the rake was placed at the ramp on line 1 and trucks were loaded. With the commencement of commercial run, this will fulfill the public demand for reducing severe traffic congestion in Thane area thereby reduce journey time for trucks, save valuable fuel, reduce pollution and head towards a greener environment.

In its first such initiative, auto giant Maruti joins hands with national transporter Indian Railways to transport its cars to various parts of the county from Detroj in Gujarat. This is the first such rake to roll on 24^th March, 2018. Western Railway transported 125 Maruti Suzuki cars in 25 NMG coaches from Detroj in Ahmedabad Division for Nidvanda Railway Station of KSR Bengaluru Division of South Western Railway covering a distance of 1716 kms. These cars were loaded in less than 4 hours.

According to a press release by Shri Ravindar Bhakar – Chief Public Relations Officer of Western Railway, the loading started at 8.00 hrs and completed at 11.40 hrs , i.e., within a duration of 3 hours and 40 minutes. Indian Railways has built up a relationship with Maruti Suzuki plant situated near Becharji Station of Patan District in Gujarat with a production capacity of approximately 2.5 lakh cars per annum. This number is expected to increase in the near future. For handling of rakes from Detroj station, Maruti Suzuki India Limited in consultation with the Indian Railways has developed a stacking area of 8000 sq.m. with a capacity to stack cars for handling up to two NMG rakes .

Shri Piyush Goyal, Hon’ble Union Minister of Railways has also appreciated this unique initiative of Indian Railways in the field of freight loading through his tweet in which he has said that, “From transporting autos to Amul butter, Indian Railways gives you the most economical, safe, timely and environment friendly transportation. Adopt it today!”. Detroj Station was developed with minimum capital expenditure with the cooperation of M/s Maruti Suzuki India Ltd. as partner in this transportation business. Railways will not only transport manufactured cars to all destinations of the country but also provide in logistic solution for export of vehicles.

This initiative is a great beginning for the development of industry and the Gujarat state area for making it a hub of car production in near future.