Cab­i­net nod for state-level JVs with In­dian Rail­ways

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he Union Cab­i­net has cleared for­ma­tion of joint ven­tures be­tween In­dian Rail­ways (IR) and state gov­ern­ments with ini­tial paidup cap­i­tal of ` 100 crore. The move to bring states on board for ex­e­cut­ing rail projects is ex­pected to ease the pain of ac­quir­ing land and al­low shar­ing of the cost bur­den, a govern­ment re­lease said. It will also speed up lan­guish­ing projects and help com­plete new projects on time.

Fur­ther infusion of fund, over and above the ` 100 crore of ini­tial paidup equity, shall be done af­ter ap­proval of the pro­ject and its fund­ing at the level of ap­pro­pri­ate com­pe­tent au­thor­ity. The ini­tial paid-up cap­i­tal of IR has been capped at ` 50 crore for each state. The JVs could also form pro­ject-spe­cific spe­cial

Tpur­pose ve­hi­cles with equity hold­ing by other stake­hold­ers like banks, ports, pub­lic sec­tor un­der­tak­ings and min­ing com­pa­nies.

Be­sides fi­nan­cial par­tic­i­pa­tion of states, the JV route for rail­way projects should fa­cil­i­tate faster statu­tory ap­provals. It will ben­e­fit lo­cal in­dus­tries like ce­ment, steel and power in get­ting their raw ma­te­ri­als.

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