Projects that offer a rate of return of less than 12 per cent are bracketed as “socially desirable”.

Of the 432 new-line, gauge-conversion and doubling projects, two-thirds (292) have a rate of return of less than 12 per cent, the Standing Committee on Railways noted with concern. In fact, 222 of them have a negative rate of return, according to the report.

‘Rethink on definition’

Seeking an assessment of the quantum of social service obligations, the Committee has asked the Ministry to have a re-look at defining the Railways as a ‘commercial undertaking’ as, much like defence and roadways, the transporter makes an indirect contribution to overall GDP, besides also fetching direct earnings.

“…the concept (of the Railways being a commercial undertaking) was alright as long as it was under the British regime. Whatever penny the Britishers invested, they wanted returns out of it,” added the report.

The Committee was apprised that, while the Railways had not yet received a response from the Finance Ministry, steps had been initiated in this regard by merging the Rail Budget with the General Budget. According to the Railways, the total net social service obligation on coaching and freight services was at ₹34,000 crore in FY16.

‘Fund social projects’

In this context, the Committee has asked the government to come up with viable plans to fund ‘socially desirable projects’ in a phased manner so as to address issues in perspective, remove hindrances and work as a pro-active facilitator of connectivity.

The Railways, the Committee report said, could only fund these projects through gross budgetary support (GBS) and through outside credit whereby the Railways have to pay market rate, because the return from these lines would not be substantial enough to reimburse the cost of borrowing.

Moreover, 83 of the 432 projects form a part of the list of Railways’ ‘least priority projects’. An additional 29 projects do not even make it to this list. The list was drawn up to optimally utilise the meagre budgetary support and avoid funds from being spread too thin.

However, the Railways have prioritised some projects as national projects (which is on the ‘top priority’ list): these include some in Jammu and Kashmir and the North-East.

As on date, the Railways have a throwforward of 495 ongoing, pending projects worth ₹4.36-lakh crore, which can never be completed if the public sector behemoth were to proceed with the present mode of funding, the panel report noted.

It was back in 1894, that Gustav Adolf Pfleiderer established a lumber rafting and trading business in Heilbronn, Germany. By 1920, the family-owned company Pfleiderer was already supplying wooden sleepers to Deutsche Bahn (then known as Deutsche Reichsbahn), the German railway operator. Several innovations followed in the subsequent years, the company emerged as one of the important partners of Deutsche Bahn in supplying high speed tracks. Meanwhile, the Mittelstand company (term used for typically a family-owned small and medium-sized manufacturing firm in Germany) had expanded footprints across the globe.

In 2006, the track system unit of Pfleiderer, with around 850 employees, was sold to AXA Private Equity and renamed RAIL.ONE.

In 2013, in one of the first of its kind acquisitions, a lesser-known Indian firm from Siliguri in West Bengal, PCM Group, acquired RAIL.ONE. As PCM group completes almost four years of acquisition, the odd marriage between a mid-sized Indian and a German company has turned out to be precedence for the much touted Make in India Mittelstand programme, aimed at collaboration between Indian and German small and mid-sized manufacturing units.

In fact, PCM Group acquired a company which was almost double its size in terms of turnover. RAIL.ONE has a turnover of around Euro 145 million (about Rs 1,091 crore), while PCM Group has an annual turnover of close to Rs 600 crore. Thus, the PMC RAIL.ONE Group has now a collective turnover of close to Rs 1,600 crore.

“We purchased at a price much lower than the revenue. The PE fund which owned RAIL.ONE did not want to run the company, and it was a good opportunity for us to expand our footprints,” said says Nishant Mittal, member of the supervisory board at PCM RAIL.ONE.

In fact, back in 2007, when Saudi Arabia was inviting bids for setting railway network in the region, RAIL.ONE was a major competitor to PCM Group. While PCM set up two plants in the country, RAIL.ONE set up one.

“That time, in 2007, we never thought of acquiring RAIL.ONE as it was completely out of our reach,” says Mittal.

By virtue of the acquisition, an Indian-promoted firm has now emerged as a major supplier (Q1 or highest quality standard supplier of concrete and turnout sleepers) to Deutsche Bahn. So far, the company has supplied close to 20 million concrete sleepers for the German railway network.

“One of the biggest challenges for us was to understand the synergies the cultural differences. In the beginning, there were a lot of anxieties in the German side about the acquisition,” says Mittal.

Recently, RAIL.ONE underwent a restructuring, whereby German operations have been separated into a new entity, and a holding company, called PCM RAIL.ONE Group, has been created for all the subsidiaries of the company. Prior to the acquisition, PCM Group’s overseas operations were limited to Saudi Arabia, the UAE and Bangladesh. However, post the acquisition, it has footprints in Romania, Spain, South Korea, Hungary, Turkey, the United States, apart from Germany.

The re-shaping of the company’s organization was a step towards facilitating future international growth and market concentration. The holding entity, which provides marketing, R&D, business development as well as strategy and group controlling, is helmed by Jochen Riepl and a supervisory board consisting of PCM family members.

In the next two to three years, PCM RAIL.ONE is looking at an investment of around Euro 30 million, according to Mittal.

Some of the ongoing projects of the company include one in Aschaffenburg (Bavaria/Germany), where PCM RAIL.ONE is setting up a new plant with a capacity of 600,000 sleepers per year. In the future, the new site in Aschaffenburg will be the logistic center for sleeper delivery in western Germany. In the Middle East, the company is delivering prestressed concrete main line sleepers for North South Project, which covers a length of 2,400 km. This apart, it is also pursuing large-scale projects in Scandinavia (up to 800 km of high-speed lines). This apart, the company is also engaged in a number of projects for Indian Railways.

A.K.Mital, Chairman, Railway Board (CRB), New Delhi stressed on according top priority to Passenger Facilities, Safety and Punctuality on the Indian Railways. He was addressing a high level performance review meeting of General Manager’s (GMs) of all the Zonal Railways including Production units on the aspect of Safety, Punctuality, Loading and Works in progress today i.e., 9^th Aug, 2017 from Railway Board, New through video conference.

Interacting with the General Manager’s, Shri A.K.Mital stated that top priority shall be accorded to safety in train operations. He instructed General Mangers to conduct more surprise inspections to ensure safe travel of the passengers and in providing good facilities, since they are our stakeholders and at the same time punctuality should also be maintained. Further he instructed the officials to focus on cleanliness during Swachh Phakwada Drive commencing from 16^th August, 2017. He advised all the General Managers to take up measures to address the passenger complaints with regard to catering, watering facilities in coaches etc. The Chairman Railway Board wanted that importance be given to ongoing rail developmental works (Doubling, Tripling, Electrification etc)  for completion in target time and was appreciative of SCR for being on Target. Speaking on freight loading, he advised the officials to identify the key issues  to focus for gaining business.

Vinod Kumar Yadav, General Manager, SCR spoke on the performance and achievements of the Zone. He stated that the Zone is able to attain target mile stones in doubling, tripling and electrification works as well as reach the mark in Revenue earnings. Shri Vinod Kumar Yadav added that some issues such as works related and cleaning contracts etc need Railway Board’s attention.

John Thomas, Additional General Manager; Shri K.V.Siva Prasad, Principal Chief Engineer; Shri Arjun Mundiya, Chief Mechanical Engineer; Shri Vinay Mohan Srivastava, Chief Signal & Telecommunications Engineer; Shri A.A.Phadke, Chief Electrical Engineer; Shri D.K.Singh, Chief Safety Officer attended the meeting.

A senior IAS officer from Bihar was found dead close to railway tracks in Ghaziabad near Delhi on Thursday night. A suicide note was found next to the mutilated body of Mukesh Pandey, who was described by Bihar Chief Minister Nitish Kumar as an “efficient administrator and sensitive officer”.

Mr Pandey, a District Magistrate in Buxar, said in the note he was “committing suicide of my own volition” and directed the police to a “more detailed suicide note” in his bag at a five-star hotel room in Delhi.

In the suicide note, he spoke about jumping off a building because he was “fed up” with his life.
“I am committing suicide in district centre area of Janakpuri in west Delhi…by jumping off the 10th floor of the building. I am fed up with life and my belief on human existence has gone, my suicide note is kept in a Nike bag in room 742 of a five-star hotel in Delhi. I am sorry, I love you all! Please forgive me,” said the note, according to police officer HN Singh.

The police say initial evidence suggests suicide but they are investigating how and when the officer took his life. His body was identified with the help of his cards.

Mr Pandey reportedly checked into a luxury hotel in the afternoon and around 4.30 pm, took a cab to a mall in west Delhi. He sent WhatsApp messages to relatives that he was going to commit suicide. The relatives called the police, who rushed to the mall but didn’t see him.

CCTV footage showed the officer, in a blue T-shirt and jeans, leaving the mall and heading to a metro station.

Around 8 pm, Mr Pandey’s sister-in-law looked for him at the hotel and, not finding him, reported him missing.

Later, the police learnt that he had been found dead near rail tracks.

Mr Pandey, a 2012 batch Indian Administrative Service officer, ranked 14 in the civil services exam and was known to for his impeccable track record. “May God bless his soul,” said Nitish Kumar.

A senior IAS officer from Bihar was found dead near Delhi and his body was found near the railway tracks in Ghaziabad on Thursday. The body of Buxar District Magistrate Mukesh Pandey was found about one km from the Ghaziabad railway station, police said. A suicide note was also recovered from the spot.

Police said it was written in the note that Mr Pandey, a 2012-batch IAS officer, was fed up with his life and lost his “belief on human existence”.

“I am committing suicide in district centre area of Janakpuri in west Delhi…by jumping off the 10th floor of the building. I am fed up with life and my belief on human existence has gone, my suicide note is kept in a Nike bag in room 742 of a five-star (name withheld) hotel in Delhi. I am sorry, I love you all! Please forgive me,” said the note, according to Senior Superintendent of Police HN Singh.

The police officer said it was not immediately known that at what time or how Mr Pandey died.

The post mortem would be conducted today.

Officials of the Government Railway Police (GRP) who reached the spot, near Kotgaon, said prime facie it appeared a case of suicide.

Senior officials of Ghaziabad district administration also reached the spot.

Meanwhile, a senior Delhi Police official said that police received information from his friends that Mr Pandey would commit suicide and had gone to a west Delhi mall.

A police team was immediately rushed to the mall but it could not trace him.

After scanning the CCTV footage, it was found that he was leaving the mall and going towards the nearby metro station, the official said, adding on analysis of CCTV footage there, he could not be traced.

Later, Delhi Police learnt that he had committed suicide, the official said.

Mayiladuthurai Member of Parliament RK Bharathi Mohan has appealed to Union Railway Minister Suresh Prabhu to provide a halt for Rameswaram-Faizabad Sharadha Sethu weekly Express at Mayiladuthurai station.

In a letter sent to the minister, a copy of which was released to the media in Thanjavur, the MP said there were several temples including the famous Lord Saniswaran temple at Tirunallar and Kethu temple at Keezhperumpallam, all located around Mayiladuthurai and stoppage for ‘Sharada Sethu express’ via Ayodhya would help devotees wanting to visit these places.

Moreover, all express trains including Rameswaram-Bhubaneshwar, Mannargudi-Chennai Express and Karaikal-Mumbai Express stop at Mayiladuthurai, he said.

As Sharadha Sethu Express stops only at Villupuram after Kumbakonam, a halt could easily be provided at Mayiladuthurai, he added.

“There may not be any problem with regard to time as the train stops for about 45 minutes at Villupuram,” the MP said.

The Goods and Services Tax (GST) Council’s decision to roll back the increase in tax rate for government works contracts comes as a relief for the Indian Railways which had received representations from contractors on increased tax liability on various ongoing projects.

“The GST Council’s decision to cut back GST on contract works to 12% has come as a big relief to us as there was huge uncertainty,” said a senior Railway Ministry official.

“The contractors were demanding more money for contracts awarded before July 1 due to increased tax liability but the Railways had refused to pay for the higher tax amount,” the official said.

The tax on construction activity, including composite work contracts, was increased to 18% from 12% under GST. However, Finance Minister Arun Jaitley announced after the GST Council meeting on Saturday that government works contract, for both Centre and states, will attract 12% GST with input tax credit.

Panel set up

The Railway Ministry has also constituted a committee to examine the impact of GST on the work contracts after receiving representations from contractors on increased tax liability.

Work related to track, construction of bridges, earthwork in embankment, supply, unloading and spreading of ballast, among others were facing increased tax liability after the government’s initial move to increase GST on such projects.

Claiming that a high GST rate on old contracts adversely affecting those in the business, a body of railway contractors here today threatened to go on a strike on August 20. “There is no clarity as to how the GST will be implemented with respect to old railway contracts. Contractors have received no payments since July 1 on account of this confusion.

We had recently met Railway minister Suresh Prabhu with the request to come up with a solution, but to no avail”, national vice president of Indian Railway Infrastructure Providers Association, Ashok Kumar Pathak told reporters here. He alleged that while Prabhu placed the ball in the court of the GST council, the latter refused to take any responsibility by asking us to sort out the matter with the ministry. Pathak said the bone of contention was the GST having been fixed at 12 per cent which was much higher than the VAT which contractors had been paying prior to the new tax regime.

“VAT payable in states like Rajasthan was as low as one per cent while in Uttar Pradesh it was not more than four per cent. On August 5, the GST council fixed GST rates for both old and new contracts at 12 per cent. This would hit the contractors badly. “We have, therefore, been requesting that as far as old works are concerned, contractors be made to pay not more than four per cent towards GST while the rest may be borne by the Railways,” he said.

“Left with no options, we have decided to observe a nation-wide strike on August 20. We hope that the government acts in time and we are not forced to do anything that adversely affects railway operations across the country,” he added.

An aggressive and well-coordinated road-to-rail freight conversion effort combined with an economic rebound directed more volume to Container Corporation of India (CONCOR), boosting the state-owned rail giant’s first-quarter earnings by double digits.

CONCOR officials during a press briefing cited double-stack train service expansion, to 479 runs from 164 runs in the January-to-March period, and a surge in imports as key factors for the first-quarter performance. Container volumes at India’s major or public ports grew 6.3 percent year over year in the first fiscal quarter to 2.25 million TEU, a growth trend that continued in July as traffic rose 5 percent year over year to 752,000 TEU. India’s GDP growth will accelerate slightly this fiscal year to 7.3 percent, according to IHS Markit forecasts, which expects improving domestic demand and recovering commodity prices will drive import growth. India’s GDP grew just shy of 7 percent in the first fiscal quarter.

CONCOR’s net profit during jumped 36.4 percent year over year in the April to June period to Rs. 243.38 crore ($38.2 million) from Rs. 178.48 crore a year earlier, on revenue that was up 11.2 percent to Rs. 1,550.44 from Rs. 1,394.35 in the same three months of 2016, according to a company filing with the Bombay Stock Exchange.

That is a solid start to fiscal 2017 to 2018 for India’s largest intermodal company after it suffered a 12 percent dip in net profit and a 5 percent fall in revenue in the last fiscal year.

An analysis of the results shows first-quarter operating income from CONCOR’s core international business increased 5 percent year over year to Rs. 1,131.5 crore, whereas income from domestic operations totaled Rs. 325.21 crore, a 32.5 percent gain over April to June 2016.

As a result of that strong growth, CONCOR’s market share climbed to 76.3 percent from 72.5 percent in the last quarter of fiscal 2016 to 2017, according to the statement.

Officials also said Jawaharlal Nehru Port Trust’s (JNPT) direct port delivery (DPD) program, which is already creating major growth challenges for rival logistics providers. has had no impact on volumes handled at CONCOR’s Dronagiri inland terminal located close to the public harbor.

“We are able to maintain our volume levels and in fact, we started handling DPD containers in our CFS [container freight station] and in the last quarter, we also did some trains [for DPD volumes] and there will be a lot of emphasis in the coming days,” they said.

Officials said though it is too early to tell what the Goods and Services Tax (GST) means for the intermodal logistics industry, rail volumes are expected to grow in the coming months as the government ramps up efforts to shift more loads away from trucks that are clogging port roadways.

The company is said to control around 84 percent of rail cargo through JNPT, and at the ports of Mundra and Pipavav, its share is slightly more than 50 percent. It is in the process of adding more services connecting the two private ports to the Jakhwada Inland Container Depot, near Ahmedabad in Gujarat State.

To meet expected growth, CONCOR is looking to spend about Rs. 1,000 crore during the year on capacity expansion. The company currently operates 68 inland locations and another four sites through tie-ups with other service providers.

More than 800,000 protesters who are Marathas disrupted Mumbai traffic and strained its railway network on Wednesday as they pressed their demands for reserved quotas in government jobs and colleges for students. The Marathas are a politically powerful group because they constitute 33 percent of Maharashtra’s population. Chief Minister Devendra Fadnavis said that his government supports affirmative action policies for the dominant caste. But he offered no schedule for implementing new policies to benefit Marathas.

More than 800,000 protesters disrupted Mumbai traffic and strained its railway network this morning as they  pressed their demands for reserved quotas in government jobs and college places for students.

Young people and senior citizens of  the Maratha community waved saffron flags in a protest that the police said was free of incidents of violence, with more than 10,000 policemen on guard.