Explained: Indian Railways’s Ambitious 180 Day ‘Bid To Award’ Plan To Start 150 Private Trains In 12 Clusters

Niti Aayog has prepared a detailed roadmap to help Union government operationalise its plan to run 150 private trains on 100 routes.

According to the timeline envisaged in the ambitious plan that for the first time seeks to establish the principle of ‘seperation of content and carriage’ in the railway sector, the ‘bid to award’ will be be done in 180 days at an estimated investment of Rs 22,500 crores.

The government thinktank released a paper titled 'Private Participation: Passenger Trains' identifying 100 routes in 12 selected clusters, including Mumbai Central-New Delhi, New Delhi- Patna, Allahabad-Pune and Dadar-Vadodara, for operation of private trains.

Under the plan, while Indian Railways will continue to control signalling and tracks, the selected private players will be granted concession for a period of 35 years for running passenger trains on 100 paths bundled into 10-12 clusters.

During the concession period of 35 years, the private players will be bestowed with the right to collect market linked fares. They will be provided with flexibility to decide on class composition and halts. The private players will have the ability to provide value-added/differentiated customer service. The private operators can also procure technology agnostic rakes including trainset and powerhead.

The complete responsibility for procurement of entire rake (minimum 16 coaches a train) will vest with the selected private concessionaire and they would be required to deploy 100 per cent of trains within 5 years.

The selected private players will have the flexibility to procure rolling stock from source of their choice (domestic or overseas), subject to compatibility with Indian Railway standards. A third-party certification by accredited Independent Safety Assessor (ISA) will be required till such time as Research Design and Standards Organisation (RDSO) adopts testing norms defined in in accordance with international standards.

The private players will be chosen at the end of a two-stage bidding process comprising Request for Quotation (RfQ) and Request for Proposal (RfP). Bidding will be on cluster basis with cluster regarded as project (entailing around 12 rakes) . The eventual winner will be selected on the basis of per cent of Gross Revenue Share that they are willing to share with the government. Each bidder will be eligible for award of maximum three clusters.

The selected concessionaire will be required to make two kinds of ongoing payments for operating the train - a) 5 per cent of Gross Revenue Share as provided in the bid and b) haulage charges from the date of commencement of operations which will be indexed (WPI) every two years as per a pre-specified formula.

The selected private players will be responsible for complete operation and maintenance of the trains. They will be empowered to deploy Crew (Driver and Guard) of their choice but can also exercise the option of seeking resource from Indian Railways. The private player has to compensate for claims in respect of loss of life, bodily injury, luggage and goods etc by taking Insurance.

Hundred routes, including Mumbai Central-New Delhi, New Delhi- Patna, Allahabad-Pune, and Dadar-Vadodara have been identified. Other prominent routes include Howrah-Chennai, Howrah-Patna, Indore-Okhla, Lucknow-Jammu Tawi, Chennai-Okhla, Anand Vihar-Bhagalpur, Secunderabad-Guwahati, and Howrah-Anand Vihar. The 100 routes are into 10-12 clusters.

The Railway Board had in October last year formed an empowered group of secretaries, headed by Niti Aayog CEO Amitabh Kant, to chalk out the modalities of the bidding process and take other decisions to fast-track awarding of bids to private players.

The Tejas Express on the Lucknow-Delhi route, which was flagged off on 4 October, is the railways' first experience of letting a non-railway operator run a train. The Tejas Express is run by railways' subsidiary IRCTC.