Indian Railways Denies Inviting Bids For Running Passenger Trains On PPP Mode

The Ministry of Railways on Tuesday said it has not invited any bids for running passenger trains on public private partnership (PPP) mode.

A news report published in a prominent daily and digital version stated that Indian Railways has for the first time invited bids from private entities to run 150 pairs of passenger trains through PPP mode. The report also stated that private entities shall have the liberty to decide passenger fares on these trains.

The national transporter has called them “misleading media reports”, while clarifying that no such proposal is under consideration and neither have any bids been invited recently.

The news report in question claimed that the arrangement of running passenger trains through the PPP mode is expected to fetch the railways around Rs 30,000 crore in revenue from the private sector.

It further added that these trains will be part of 12 clusters across the railway network.

Each of these trains shall have a minimum length of 384 metres, which is equivalent to 16 coaches.

Previous Attempts

In a first-of-its kind initiative, Indian Railways in 2020 invited bids for private participation in operation of passenger train services over 109 origin destination pair of routes through introduction of 151 modern trains (rakes) divided into 12 clusters.

The project would entail a private sector investment of about Rs 30,000 crore.

In all, five bids were received for three clusters namely Cluster-2 (Mumbai-2), Cluster-3 (Delhi-1) and Cluster-4 (Delhi-2); no bids were received for the remaining nine clusters. The tender committee recommended for discharge of the tender and later on it was cancelled.

NITI Aayog, the government think-tank, in 2020 came out with a discussion paper for running 150 trains on 100 routes by private operators, envisaging an investment of Rs 22,500 crore.

The privatisation of train operation, the paper said, will help in introducing modern technology and rolling stocks with reduced maintenance.

The new rakes would increase the availability of train services to the citizens, and provide world class service experience to the passengers.

The discussion paper titled "Private Participation: Passenger Trains" stated that the private operator will have the right to collect market-linked fares and will be provided flexibility of class composition and halts.

Besides, the existing passenger train services shall not be affected by the operation of passenger train services through PPP mode and will be in addition to the existing train services.

Current Status

At present, none of the regular passenger train services running over Indian Railways are being operated on PPP mode.

The Tejas Express on the Lucknow-Delhi route, which was flagged off on 4 October 2019, is the railways' first experience of letting a non-railway operator run a train.

This is India's first privately operated train by IRCTC, a subsidiary of Indian Railways.

IRCTC provides a slew of offers for its passengers like free travel insurance of up to Rs 25 lakh, doorstep baggage collection, local food and compensation in case of delays.