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Thursday, February 26, 2015

Finance Ministry to Provide Budgetary Support of Rs 40,000 Crore for the Railway's Annual Plan

The Railway Minister has said that the Ministry of Finance has communicated a Gross Budgetary Support of Rs. 40,000 crore for the Railway's annual Plan. Presenting the Railway Budget 2015-16 in Parliament today Railway Minister Shri Suresh Prabhakar Prabhu said Rs. 1,645.60 crore has also been provided as Railway's share of diesel cess from the Central Road Fund. He said Market borrowing under EBR is projected at Rs. 17,655 crore, an increase of about 46.5% (Rs 5,609 crore) over RE 2014-15. Balance Plan outlay includes Rs. 17,793 crore from Internal Resources and Rs.5781 crore from PPP. The Minister informed the Parliament that large amounts have been allocated towards Doubling, Traffic Facilities, Electrification and Passenger Amenities. 

The Minister said Railways has proposed a Plan outlay of Rs. 1,00,011 crore, an increase of 52% over RE 2014-15. Shri Prabhu said it is anticipated that the Plan size will get higher once resources from institutional bodies are formalized during the course of the ensuing financial year. 

He said given the huge shelf of project and ensuring proper funds flow for the same with a view to completing them on target, a new financing approach to expand EBR has been projected. This EBR, presently named EBR (Institutional Finance) would be based on institutional investments in railway projects through Railway/ PSUs. This element is projected at Rs. 17,136 crore and is aimed at accelerating completion of capacity augmentation projects. This new vista being tapped has promising potential. 

Shri Prabhu said while the budgetary support has been increased progressively over the years, it has not been adequate to realistically fund the large shelf of projects that are in the pipeline. He said many of the projects relate to decongestion in heavy traffic sections and are, therefore, remunerative. Such projects can be taken to accelerate completion by tapping market funding from institutional finance agencies, multilateral lending, etc. In this background, more than a hundred projects valuing more than one lakh crore have been identified through extra budgetary resource subject to due process being followed, the Minister added. 
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