Centre signs MoU with AP Govt
Hyderabad, Jan 28 (INN): In the august presence of Union Minister of Railways Suresh Prabhakar Prabhu, a Memorandum of Understanding is signed between the Ministry of Railways and State Government of Andhra Pradesh for 'Formation of Joint Venture for Development of Railway Infrastructure in the State Andhra Pradesh'.
On behalf of the Railway Ministry, Ved Prakash Dudeja, Executive Director/Works signed the MoU whereas on behalf of Government of Andhra Pradesh P. K. Srivastava, Advisor, Rail Projects, Government of Andhra Pradesh signed the MoU at New Delhi on Wednesday. The MoU were signed in the background of Railway Minister's budget announcement regarding setting up of Joint Ventures with States for focused project development, resource mobilization, land acquisition, project implementation and monitoring of critical rail projects.
Speaking on the occasion, Suresh Prabhakar Prabhu said that the Indian Railways was happy to have a dream come true, of Cooperative Federalism. He said that the MoU was very important since it would help in developing rail infrastructure in the State of Andhra Pradesh.
The MoU envisages formation of a Joint Venture company having 51% stake of State Govt. and 49% stake of Ministry of Railways. Thus, the JV company shall be fully owned by the Government. The company will primarily identify projects and possible financing avenues in addition to Govt of India and the state Govt. After finances for a project are tied up, a project specific SPV or special purpose vehicle shall be formed. This SPV can have other stake holders from Industries, Central PSUs, State PSUs etc. However, the JV company shall be a mandatory stake holder with minimum 26% shares in the SPV. The Ministry of Railways will sign a concession agreement of 30 years with the project SPV for safe and sound operation, revenue sharing and providing technical & marketing logistics to the SPV. The revenue sharing shall be based on already established formula being used for inter zonal apportionment of revenue.
News Posted: 28 January, 2016
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