Gimmick is something Railway Minister Lalu Prasad Yadav is known for. The proposed eastern freight corridor also fits into his gimmickry. It is inaugurated for the second time.
The foundation stone for the project was laid by Prime Minister Manmohan Singh in September 2006 at Ludhiana in Punjab, months before the elections were held in Punjab.
This time he has chosen a place in his home state Bihar for a 105 km stretch from near Mughal Sarai to near Sonnagar. It is a stretch, where a third railway line largely dedicated to goods traffic already exists. The track is used for transporting coal.
The eastern and western freight projects are targeted for completion in 2015 provided the actual work begins now. In all probability, it is going to be delayed.
Yadav is a good showman. He uses the skill to do many cover ups. He has been doing it as Bihar Chief Minister. He has extended it to Indian Railways. So he does not mind inaugurating the Eastern Freight Corridor for the second time, which was originally to extend from Ludhiana to Kolkata. It was earlier inaugurated in Punjab before Punjab elections. It is not without a cost to the exchequer. Each inaugural programme has many overt and hidden costs. It is not merely borne by the railways but many costs have to be borne by the state governments as well, including transportation, law and order, security and other paraphernalia.
The freight corridors are also not a novelty any more as it is being touted. The corridors are being discussed for the past many years. There is nothing new in it. Its need was stressed even in the eighties. That is a process. No major project comes in a day. There are many processes, evaluations and cost studies before a project is actually launched.
For a major project like this no particular Railway Minister could claim all the credit. In reality, ministers are only incidental. Projects are evolved owing to their functional utility. These are conceived and given shape by railway officials and engineers often in consultation with the state governments and Planning Commission.
Corporates often hold repeat shows to launch their products. They hold such shows in metros and major cities. But if it is done by the railways it causes concern. The railways are not as cash rich as the Railway Minister had been projecting. The image is engineered. The railways even engineered Yadav's?management guru? image. The railways paid Rs 50 lakh to Indian Institute of Management, Ahmedabad for organising his ?management? lecture. A similar exercise is said to have been done with Harvard University in US as well.
The railway budget of 2006-07 had announced the eastern and western freight corridor projects. The projects are expected to cost Rs 28,181 crore ? eastern corridor Rs 11,589 and western corridor Rs 16,592 crore.
The eastern corridor is proposed to extend from Ludhiana to Dankuni, 20 km from Kolkata port. Logically it should have been extended to Kolkata or Haldia port.
Lalu Yadav had declared a surplus of Rs 25,000 crore in 2008-09 budget. It is surprising that the railways despite such ?large? surplus is looking for its funding through various foreign assistance, including loan from Japan, World Bank and Asian Development Bank (ADB). It is clarified in this year's budget that actual surplus is not more than Rs 5000 crore if his borrowings of Rs 8000 crore are taken into account.
Except the government of Japan nobody has yet made any commitment. But Japan refused to give any assistance for the eastern corridor. The Japanese government estimates did not find the eastern corridor a viable project. The returns would be lower as Kolkata being a riverine port is not expected to generate enough traffic. The eastern corridor is seen to have fallen behind the western corridor project, which the Japanese have decided to support.
This has forced the railways to take up the small section of 105 km in Bihar from its own resources. The total proposed length of the corridor is 1805 km. The railways have not said anything about the rest of length. It was to keep the Left parties in good humour that the project was to be extended to Kolkata.
There is apprehension in Railway Ministry that the 105 km section of such a long line may lock up funds as work would be going in a piecemeal manner. The railways have approached the World Bank for $ 2.5 billion assistance and ADB for technical assistance for the eastern corridor. However, no commitment has been received. The world is passing through a critical situation. It is as yet not clear that the funding from the two institutions would be forthcoming.
Japan has committed to ODA loan of Rs 17045 crores, for the first phase of the western corridor. This amounts to 62 per cent of the total cost of Rewari-Vadodara stretch. Japan is also likely to provide a similar loan for the second stage of the western corridor extending to Jawaharlal Nehru Port Trust in Mumbai.
The Prime Minister had laid the foundation stone for the Mumbai-Rewari project on October 5, 2006. Since there has been little progress on actual construction as financial tie-ups had not been finalised.
The work on both the projects was to begin in the current financial year. It is not possible now. The western project, which is initially to be limited between Rewari and Vadodara, is still several months away from construction work starting at the ground level.
The first works to be taken up are 54 important bridges over 200 kms on the Western corridor, and the 105 Km section on the eastern corridor. Bids for project management consultancy and turnkey contracts in these sub-projects have reportedly been received. But their evaluation has not yet been completed.
It is difficult to understand why such inauguration jamborees should be undertaken, when the actual results remain doubtful.
(The writer is senior political and economic journalist and former senior editor of The Financial Express and can be contacted at [email protected])
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