NEW DELHI, July 22: Wooing the banking and financial sector, Railway Minister Suresh Prabhu has rolled out ambitious investment plan of Rs 8.5 lakh crore in the coming five years in the public transporter.
Referring to the 2015-16 Railway Budget, Prabhu said there are numerous initiatives in the budget proposals to modernise the system, to remove bottlenecks and to build capacity.
Railways and its PSU Indian Railway Finance Corporation has organised a meeting of banks and financial institutions (FIs) here to sensitise the sector of the opportunities and challenges offered by the Railways - massive investment plans for strengthening and modernising the key railway infrastructure in the country.
Railways have drawn up a massive investment plan of Rs 8.5 lakh crore in the coming five years, he said and referred to the MoU with LIC which has assured funds of Rs 1,50,000 crore in 5 years for rail projects.
A detailed presentation of railways' investment plans was made at the meeting yesterday which highlighted the possible areas such as Dedicated Freight Corridor, high speed rail system, and station redevelopment among others.
Recognising the significance of scaling up investment in the railway infrastructure in the country's economic growth, the meeting was also addressed by Minister of State for Finance Jayant Sinha and Raghuram Rajan, Governor, Reserve Bank of India.
Sinha appreciated the railways' plans for massive investments in the sector and emphasised the need to get the projects going without delay as the economy is poised at the profound moment between fiscal consolidation and fiscal expansion.
RBI Governor pointed out the long term nature of investments in Railways and the need to create appropriate structures which will withstand political and regulatory risks in the long term.
Rajan said learning from the recent past, financing plans will have to provide for more equity cushion, flexible debt structures and allow for a reasonable coverage of cost overruns.
Representatives from principal banks and financial institutions attended the meeting.
