Indian Railways (IR) has embarked on a massive transformational journey to create world-class railway stations. IR is undergoing a fundamental change in order to build these stations. The Government of India has launched the station redevelopment programme, which aims to redevelop 400 railway stations across India for Rs 1,000 billion under a public-private partnership (PPP) model. The programme will try to develop self-sustainable railway stations with high standards of safety, comfort, user-friendly passenger amenities, value-added services and efficiency by adopting the best technological practices and a sound financial strategy, and optimally utilising resources.
In October 2021, IR ordered the dissolution of the Indian Railway Stations Development Corporation (IRSDC). This is in line with recommendations from the cabinet secretariat to integrate, and undertake structural reforms in, various bodies under the Ministry of Railways (MoR). The stations managed by IRSDC and all project-related documents will be handed over to their respective zonal railways. The zonal railways will further develop the station projects.
The station redevelopment programme is a major element of the Smart Cities Mission, which aims to reshape urban development and stimulate economic activity. Work on the redevelopment of 125 stations is currently under way as part of this agenda. As of December 2021, there are 52 stations being developed, 44 projects are at the planning stage, five projects are in different phases of implementation, and three projects have been completed.
Details of completed projects
Despite the challenges posed by the ongoing Covid-19 pandemic, and the challenges of these being IR’s first true brownfield redevelopment projects, Baiyappanahalli station was completed in September 2021, Rani Kamlapati (Habibganj) station was inaugurated in November 2021, and Gandhinagar station was inaugurated in July 2021. These are the first air-conditioned railway terminals in the country.
Status of railway stations being planned
According to the Rail Land Development Authority (RLDA), 40 stations are targeted for development in 2021-22, and another 120 in 2022-23. At present, the RLDA is working on 112 stations. IRSDC has adopted a form-based codes approach to regulate commercial development on railway land. Draft codes are being tested at the ongoing station redevelopment projects at the Chandigarh, Nagpur, Gwalior, Amritsar, Bijwasan, Anand Vihar and Chhatrapati Shivaji Maharaj Terminus. These codes have been formulated with a vision to standardise planning and implementation across railway stations, encouraging PPP in the process. The MoR has handed over the redevelopment of the Chandigarh railway station to the Ambala railway division under Northern Railway. The project has been delayed for over a year and a half due to Covid-19.
The allocation of Rs 2.32 billion for Amritsar railway station in March 2021 may lead to early commencement of another phase of development. Part of the infrastructure augmentation was carried out at a cost of Rs 5 billion over the past five years. For Gwalior railway station, a master plan was approved by the National Capital Region (NCR) on February 2, 2020, and in-principle approval from the Public Private Partnership Appraisal Committee (PPPAC) was obtained on December 20, 2020. No-objection certificates were received from the Indian Air Force and the forest division, Gwalior, on February 20, 2020 and February 26, 2020 respectively. For Nagpur station, the Heritage Conservation Committee, under the aegis of the Nagpur Municipal Corporation, cleared the redevelopment proposal in September 2020.
The Railway Board entrusted land at Anand Vihar to the RLDA on May 1, 2020, and transfer of the land from the RLDA to IRSDC is pending. For Bijwasan railway station, an engineering, procurement and construction contract was awarded in October 2019 and development work is in progress. A master plan for Sabarmati railway station was approved on January 18, 2020. In June 2021, IRSDC received bids from nine bidders for Chhatrapati Shivaji Maharaj Terminus. A request for proposals will be floated soon. Approval is awaited from the Railway Board for Surat railway station. A PPPAC proposal was submitted to the Railway Board on September 2, 2020 for Thakurli railway station. The Charbagh (Lucknow) project involves station redevelopment along with commercial development of 12.23 acres of land. Phase I of the project entails a cost of Rs 4.42 billion, while Phase II will cost Rs 1.14 billion. Bids have been received from seven firms as of July 2021. The New Delhi station redevelopment programme is the first one to be undertaken as part of the transit-oriented development concept in Delhi-NCR. The project will offer multiple revenue streams to the developer, including revenue from real estate rights, and is slated to be completed by 2025. It entails an investment of Rs 44.7 billion.
Issues and challenges
The programme is facing multiple challenges, including lack of private sector participation. The response received from private players has not been very encouraging so far. The key reasons that have instilled a degree of apprehension in private players include policy uncertainty, the slump in the economy, operational issues and lack of clarity. Besides, the programme attaches high weightage to the real estate industry for raising capital aimed at commercial development, making it even more risky. The real estate industry has been found to be reluctant about the redevelopment of station buildings, platforms and other core areas. The programme also requires enhanced coordination between the municipal authorities and IR. Disagreements with the local municipal authorities regarding floor area ratio (FAR) can lead to delays in the projects. The Habibganj station project was delayed because the Bhopal Municipal Corporation and IR disagreed on the FAR, among other issues. The pace of project development would also be dependent on the viability of the stations and the funds available with the implementing agencies, which is a major problem. The development projects involve work near railway tracks, which could result in serious accidents. Safety from moving trains is required, and to this end, work has to be implemented in blocks. On construction sites, adequate distance from live conductors also needs to be maintained.
New schemes in station infrastructure development
The station redevelopment programme offers opportunities for real estate development (hotels, eateries, multiplexes, shopping malls, office complexes, etc.), and development of multimodal transit hubs. IRSDC has been mandated by the union cabinet for facility management of stations on PPP basis for a concession period of 15 years. Ninety stations have already been identified for this. The focus will be on low-cost upgradation of stations. The PPP model aims to bring in efficiency in the private sector, capital resources, flexible operations and enhanced services. An agreement has been signed between RailTel and the Ministry of Communications for setting up Wi-Fi hotspots on a pilot basis at 200 railway stations in rural areas. The total value of upcoming opportunities based on upcoming station redevelopment projects is Rs 170 billion.
The programme aims to not only develop modern infrastructure at stations, but also generate steady revenue streams for the railways through the monetisation of land in and around the stations. Various projects are under implementation and new schemes such as station and commercial development and facility management of stations are being introduced.