Enhancing Customer Experience: IR gives top priority to station modernization

IR gives top priority to station modernization

Indian Railways (IR) is undertaking station modernisation projects with great vigour, with the long-term objective of providing world-class amenities to its customers and improving its overall operational efficiencies. To this end, IR plans to maximise revenue generation by monetising all land parcels it owns in prime areas of the country, and utilise the revenue to create better station infrastructure as well as enhance customer experience through physical and digital channels at railway stations.

The primary focus is on improving passenger amenities at railway stations. Currently, IR has about 8,300 railway stations. It has identified 400 Category A and A1 stations in 100 large cities across the country for modernisation/redevelopment. These stations have 16 million passenger footfalls per day, a 7 per cent annual growth in footfalls, 2,700 acres of prime real estate land on lease for a period of 45 years and encroachment-free land.

The total investment requirement for developing these 400 stations and commercial establishments around them is Rs 960 billion – Rs 680 billion for commercial development and Rs 280 billion for station development.

Indian Railway Stations Development Corporation Limited (IRSDCL) has been entrusted with the redevelopment of 12 stations. Besides, 23 stations will be redeveloped by the respective zonal railways on the bid challenge method (modern Swiss Challenge method).

IRSDCL’s financing model, focus areas and implementation strategies for station redevelopment

The financing model to be used by IRSDCL for station redevelopment is based on the following three parameters:

  • Self-financing mechanism: The capital and running cost of the project will be financed through project revenues and station facility revenues.
  • Project revenues: Revenues from commercial development of spare land and airspace.
  • Station facility revenues: Revenues from the station development, except train tickets, platform tickets and rail display network. Further, the design concept of station development is based on seven guiding principles (seven C’s) – cleanliness, city centre, convergence, convenience, communication, congestion-free and conservation.

IRSDCL will be using both public-private partnership (PPP) and engineering, procurement and construction modes for project execution. The formats to be used for the PPP model are the design approved and the bid challenge models. The private player will implement the project within three years and operate and manage it for another 12 years. For commercial development around the station, land will be leased to the private player for a period of 45 years, and development works are scheduled to be completed within the first eight years.

Based on a presentation by S.K. Lohia, managing director and chief executive officer, IRSDCL, at a recent India Infrastructure conference