Privatisation of Railway Stations – Bane or Boon?

Of late, we are seeing world-class stations coming up on Indian Railways. Gandhinagar Railway station in Gujarat and Habibganj Railway Station in Madhya Pradesh are two examples of privatisation of railway stations. These two stations are being re-developed to world-class airport style stations with all modern facilities. The work on both the stations are nearing completion, and will be opened for public use very soon. More railway stations, New Delhi, Bijwasan and Chandigarh are expected to follow the lines of Gandhinagar and Habibganj.

Indian Railways Station Development Corporation or IRSDC is looking after maintenance, modernisation as well as privatisation of railway stations in India. IRSDC is favouring the PPP model as it can relieve the Railways from funding with a huge capital needed to build up a station, which the Railways lacks at present. Under the PPP or Public-Private-Partnership model, the railways will lease the station and land to a private company, which will build up, operate, and take the profit out of it for a while, and hand over the station back to Indian Railways after a fixed period of time. The fixed period of time has been fixed at 99 years as of now.

The lease period, the fixed period in which the private company will operate the station, was previously 45 years. After not getting good response from private companies, the Railways decided to increase the lease period to the present 99 years. However, except for a few, this proposal also did not attract private players much, and hence except a few, the Railways are planning to go back to the old EPC or engineering procurement, construction model. In this model, Railways will fund the cost of redevelopment which will be done by a private company, and will be handed back to the Railways once construction is complete.

As long as ticket fares remain constant, along with basic hygiene and maintenance, there is no complaint on privatisation of stations. But now ticket prices of redeveloped, or to-be-redeveloped stations are going to increase. Despite the success of redevelopment of Gandhinagar and Habibganj Railway stations, the importance of such redevelopment is no match of that in Sir Visvesvaraya terminal in Byappanahalli, Bengaluru, or Manduadih railway station in Varanasi, now called Banaras railway station. The last two stations were renovated by Indian Railways on its own. More such examples can be Dharwad railway station in Karnataka, Santragachhi in West Bengal, or Ayodhya Junction in UP. We now have to see whether the private stations can stood up with time with so many modern aesthetic stations coming up in Indian Railways, or they fell into disrepair, as had happened with Delhi Airport Metro Line or Gurgaon metro.

Written by – Himadri Paul

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