Tata Realty, Shapoorji Pallonji, IL&FS, Reliance Infrastructure, Raheja Group and Essel Infra are among developers to evince interest in modernising and upgrading five major Mumbai railway stations -Bandra Terminus, Mumbai Central, Lokmanya Tilak Terminus, Borivali and Thane -at an estimated cost of Rs.10,000 crore. The stations will be awarded under the Swiss challenge method, where proposals are invited online and rivals can offer counter-bids. The builders will get commercial exploitation rights for railway land for 45 years in lieu of redeveloping and modernising the stations.
The successful bidders will be required to raise the stations to world standards by building new platforms, providing lifts and other passenger amenities and also maintaining the premises. In lieu, the railways will allow them to build hotels, malls, cinema halls and shops within the station complex.
The Lokmanya Tilak Terminus is the largest in Mumbai with an area of eight acres; Mumbai Central has an area of almost four acres.
The bidding process will start in August and the stations awarded for redevelopment in early 2018. For the Bandra Terminus and Borivali stations, the prospective bidders have flagged concerns over relocating the railway quarters, which would cost them almost Rs.150 crore. Other than the Mumbai stations, the one in Pune is also attracting a lot of interest from big bidders. The estimated area of the Pune station is about eight acres.
Railways has engaged EY as consultant for its market outreach programme. It plans to redevelop 400 major stations, envisaging a minimum investment of Rs.1 lakh crore. The Swiss challenge method cuts the long-drawn tendering process currently used by the railways. An expert committee will accept the best proposal and the original proposer will get an opportunity to match it.
The government is taking various steps to increase private sector participation for upgrading and modernising the Railways.
NITI Aayog, the government's think tank, has suggested measures such as flexible design and lease payment norms to ensure wider private sector participation in station redevelopment. It has recommended that station redevelopment be given infrastructure project status, which will enable easy and economical borrowing from banks.