AndhraNews.Net - ADB investment in Indian Railways

New Delhi: August 9, 2004

The Asian Development Bank (ADB) will assist Indian Railways in three phases by financing priority investments to overcome railway capacity bottlenecks and improve operational efficiency, safety and supporting implementation of a programme of reforms to improve railways' commercial orientation.

In the first two phases, the quantum of assistance will be US $ 600 million, out of which a loan amount of US $ 313.6 million has been approved. Subsequent phases of the loan are linked to implementation of the Ministry of Railways reform programme over a period from 2002 to 2010.

Components of the reform programme relate to establishing a computerized accounting system capable of providing existing government accounts and commercial accounts with break-ups by main lines of business and by main services, outsourcing non-core services, introduction of concessioning for operating some uneconomic branch lines, delineating social and commercial objectives and identification of public service obligations, tariff rationalization, rightsizing of staff strength, restructuring of Production Units, re-engineering internal business processes and customer interface, and strengthening investment planning.

Meanwhile, CRISIL Infrastructure Advisory has been appointed as the Consultant by the ADB under a Technical Assistance (TA) grant, outside the loan, for Management Consulting Services to the Ministry of Railways. The objective of the TA includes study of business development, business opportunities and progress of implementation of the reform programme.

Press Release: PIB

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