Saturday, June 25, 2022

Govt liberalises wagon investment scheme for investors

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New Delhi: The Ministry of Railways has further liberalised General Purpose Wagon Investment Scheme (GPWIS) for prospective investors, on the basis of feedback received from investors and end users, it said on Friday. The ministry said that end-users (other than logistics service providers) have been granted permission to load third party cargo in their rakes in empty direction. “This will not only reduce the empty run of GPWIS rakes, but will also entail additional revenue to end user investors, in form of freight rebate,” a press release said. Design Loan charges on General Purpose wagons have been reduced from 5 percent to 1 percent. This will significantly reduce the initial investment required for the procurement of wagons.

‘Wagon Investment Scheme was a long-term demand’

As there was a long-term demand from Railway Freight Wagons Users (PSUs, Industries and other stakeholders) for better and timely availability of General Purpose Wagons (GPW), it was decided by the Ministry of Railways in April 2018, to introduce a scheme for investment in General Purpose Wagons.

GoS on privatisation has met 3 times so far

Separately, Union Minister Piyush Goyal said on Friday that a Group of Secretaries (GoS), which was formed by the Ministry of Railways in October has met three times so far. The mandate of the group of bureaucrats is to permit private passenger train operators to operate trains with world-class technology over Indian Railways Network.

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What exactly is privatisation happening in Railways?

In a written response submitted in the Rajya Sabha, Goyal said, “The GoS has held three meetings, so far. In regard to Goods trains, various wagon investment schemes, i.e. Automobile Freight Train Operators (AFTO) Scheme, Liberalized Wagon Investment Scheme (LWIS), Special Freight Train Operator Scheme (SFTO) and General purpose Wagon Investment Scheme (GPWIS) have been introduced for participation of private entities in wagon procurement.

However, operation of these goods trains remains with Indian Railways.” Participation of private sector has been allowed in construction and maintenance of Railway lines under various models of participative policy such as non-government Railway, Joint Venture, built operate and transfer, customer funding and annuity. In all these schemes, responsibility of the trains’ operation and safety certification rests with the Indian Railways. However, outsourcing of certain facilities like cleaning, pay and use toilets, retiring rooms, parking, etc is done on a need-based manner to improve efficiency. In case of any deficiency, the mechanism of redressal as per the contract is invoked.

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Telegram. Join PSU Watch Channel in your Telegram and stay updated)

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