NE BUSINESS BUREAU
NEW DELHI, SEP 7
The Union Cabinet has approved a policy for long-term leasing of Indian Railways’ land to implement the PM Gati Shakti framework, central minister Anurag Thakur announced on Wednesday. He said 300 cargo terminals will be developed in the next 5 years. The decision was taken at the Union Cabinet, chaired by the Prime Minister Narendra Modi.
- More revenue to railways and employment generation potential of about 1.2 lakh jobs
- 300 PM Gati Shakti Cargo Terminals to be developed over next five years
- From 5 years it has now been extended to 35 years, in a bid to provide sufficient time for investors to create infrastructures
Stating the benefits of the policy, the government said the move will help increase railways’ modal share in freight transportation and reduce logistics costs of the industry. It also said that the revised land policy will bring more revenue to railways and create 1.2 lakh jobs. The policy will be implemented in the next 90 days.
Earlier, the term for leasing of railways’ land was five years. This has now been extended to 35 years, in a bid to provide sufficient time for investors to create infrastructures.
Impact
- This will help in attracting more cargo to railways, increase railways’ modal share in freight transportation thereby reducing logistics cost of the industry.
- This will bring more revenue to railways.
- This will simplify approvals for utilities as envisaged in PM Gati Shakti Programme. This will help in development of public utilities like electricity, gas, water supply, telecom cable, sewage disposal, drains, optical fibre cables (OFC), pipelines, roads, flyovers, but terminals, regional rail transport, urban transport etc. in an integrated manner.
- This policy amendment will enable employment generation potential of about 1.2 lakh employment.
Financial Implications
No additional expenditure will be incurred. Liberalizing the land leasing policy would open avenues for all stakeholders / service providers / operators to establish more cargo related facilities and render their participation assisting in generation of additional cargo traffic and freight revenues to Railways.
Benefits
This policy amendment will enable employment generation potential of about 1.2 lakh employment.
Details
- The revised railways’ land policy will enable integrated development of infrastructure and more cargo terminals.
- It provides for long term leasing of railway land for cargo related activities for a period up-to 35 years @ 1.5% of market value of land per annum.
- The existing entities using railway land for cargo terminals will have the option to switch to the new policy regime after transparent and competitive bidding process.
- 300 PM Gati Shakti Cargo Terminals would be developed over next five years and about 1.2 lakh employment would be generated.
- This will increase modal share of rail in freight transportation and reduce overall logistics cost in the country.
- The policy also simplifies Railways’ land use and Right of Way (ROW) for integrated development of public service utilities like electricity, gas, water supply, sewage disposal, urban transport etc by providing railway land @ 1.5% of market value of land per annum.
- For Optical Fibre Cables (OFC) and other smaller diameter underground utilities, a one-time fee of Rs. 1000/- will be charged for crossing railway track.
- The policy provides for use of railway land at nominal cost for setting up of solar plants on railway land.
- The policy also encourages development of social infrastructure (such as hospitals through PPP and schools through Kendriya Vidyalaya Sangthan) on railway land at a nominal annual fee of Rupee 1 per sqm. per annum.
Implementation strategy and target:
- Comprehensive Policy document will be framed and implemented within 90 days of cabinet approval.
- The approvals for setting up utilities envisaged under PM Gati Shakti Programme will be simplified.
- 300 PM Gati Shakti Cargo Terminals would be developed over the next five years.
