New Delhi, July 22: The Finance Ministry has directed the Indian Railways to raise the capital from the market after the Railways sought around Rs 10,000 crore this year, part of the Government of India’s commitment towards the Rs 1.08 lakh crore mega project.
Multiple between top bosses of the two ministries, the Railways has been told to look for ways to raise the capital from the market, to be repaid by the Finance Ministry later and should not expect it as additional Gross Budgetary Support from the Budget, the Indian Express reported.
The National High Speed Rail Corporation (NHSRCL) requires around Rs 10,000 crore this year mainly for land acquisition, part of the PM Modi’s pet bullet train project. Along with that, there is a commitment of around Rs 5,000 crore towards the Dedicated Freight Corridor project.
The Railways has communicated to the Financ Ministry that it will not be able to bear the yearly interest and associated charges.
If the money will be borrowed from the market at a high rate,the cost of fundingfor the bullet train will escalate which was billed to be “as good as free” owing to the inexpensive Japanese loan.
The work for the bullet train project which will ply over Mumbai-Ahmedabad route started in December 2017, however, since then the project has faced many challenges over land acquisition from farmers backed by local political groups in Gujarat as well as in Maharashtra.