100% FDI in Railways will benefit India in building strong infrastructure backbone: PwC India

100% FDI in Railways will benefit India in building strong infrastructure backbone: PwC India

FDI will help strengthen India’s railway infrastructure at the very crucial hour of global transformation – time to put full stop to undue populism for petty politics by the earlier governments – opines PWC India

New Delhi: “The opening up of FDI in Railways is a positive. It indicates that the Government is moving forward on its plan on developing PPP structures, as was announced in the Budget. Smaller projects like freight-stations and last-mile connectivity would be easier to structure, but would bring in limited funding. Projects like suburban rail and high-speed rail will continue to require significant budgetary funding, and hence structuring PPPs for FDI to supplement the Government funding, can be complex and will take time” said Manish Agarwal, Executive Director, PWC India.

Cabinet had taken the decision to ease the FDI policy in those areas of railways that are not going to affect security and sovereign authority of the sector and the nation. “So, overall the control would be with the Railways, ownership being with the Railways and essential operations being kept with in the Railways. Getting FDI would help in speeding up lots of handicaps which the railways is facing because they are unable to finance that due to nasty policies of earlier governments and therefore it was taken as a conscious decision,” he said.

Moving ahead with the economic reforms, the Cabinet yesterday cleared the long-delayed proposal of raising FDI fully opened up for the railway infrastructure segment, like high speed trains while all security-related concerns raised by the Home Ministry have been taken care of by the policy.

“There are factors of security, factors of our concern which will be kept in mind (before clearing any proposal). It is not going to be a simple walk in, put the money and build. No. Obviously there are processes, there are ministries which look into it,” he said.

The Home Ministry had raised concerns with regard to rail infrastructure in border areas, particularly investments proposals from China.