Pvt investors cold to Howrah, Sealdah Railway lounge project

By bappaditya paul

The Railways’ plan to set up airport-styled executive lounges for passengers at Howrah and Sealdah railway stations in public-private-partnership (PPP) has hit a stumbling block due to a lukewarm response from private investors. Howrah StationThe Indian Railway Catering and Tourism Corporation (IRCTC), which had last October floated tenders inviting bids from private firms to develop and operate the proposed executive lounges for five-years said that while only one firm had bid for the lounge at Howrah; there was no bidder for the one proposed at Sealdah.

IRCTC officials say that private investors are shying away from the lounge project mainly because of the five-year contract period that the Railways’ have stipulated.

The proposed lounges, with an average capacity to seat 50 passengers at a time, are to be equipped with television, air-conditioner, room heater, wifi, washrooms with shower facility and a dedicated food-beverage supply mechanism. A passenger, while waiting for her train, can use the lounge for a charge. IRCTCEastern Railway authorities identified the sites for the proposed lounges ~ near Platform No 12 at Howrah and at the existing second class waiting room on Sealdah station building’s first floor. The initial target was to commission the lounges by mid 2015 but a lukewarm response from private investors has pushed the project to a limbo.

“Prospective investors are finding the five-year contract period too short a time to recover the money that they will be investing in developing the lounge and make a reasonable profit,” said Mr Subrata Banerjee, the deputy general manager (licensing) of IRCTC east zone in Kolkata. “The scenario is same as regards the other executive lounge projects planned at the railway stations in Visakhapatnam, Patna, Guwahati etc and our corporate headquarters has taken up the matter with the Railway Board.”   Sealdah StationTo attract private investors, IRCTC wants the Railway Board to revisit the contract period and extend the tenure by a few years, even if on a case-to-case basis. “I am not aware of any decision on this by the Railway Board as the matter is being handled by our corporate headquarters. All I can say for now is that the tenders for the executive lounges are under process,” Mr Banerjee said.

At present, the New Delhi Railway station has an executive lounge for passengers, functional for nearly three years now.

(The author is on the staff of The Statesman, India. This report first appeared in The Statesman on 18 February 2015.)

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