If all goes well, the suburban rail corridor to airport will be completed in three years with the Railway Board making it official that the line was a top priority for the project, which will rely on value capture financing and public private partnership.
In an office memorandum issued recently, officials put the cost of the project at Rs 15,767 which will be funded by the state and Ministry of Railways with 20% equity each. However, after providing Rs 500 crore through budgetary support initially, the railways has said, the rest will be financed through monetisation of the railway land.
Under the value capture financing framework, the railways hopes to generate Rs 4,815 crore through vacant railway land parcels. "The remaining expected VCF from non-railway land to the tune of Rs 2573 crore, is expected to come through premium FAR, betterment levy, land use charge and cess o approval of new layout shall be taken towards on-fare box revenue to repay the debt ," the memorandum said.
The state government has to set up an empowered committee to facilitate the railways' initiative for monetisation of its land. In a welcome move, the railways has offered to provide its land at a nominal lease charge of Re 1 per acre.
PPP must
One of the condition for approval from the board involves bringing a private player into the project through public private partnership (PPP).
"Procurement, operation (with on board train staff only) and maintenance of rolling stock should be kept on PPP mode," the condition said.
The Rail Infrastructure Development Company Karnataka Limited (KRIDE), the SPV implementing the project, has been given a deadline for building all four corridors. Interestingly, KRIDE officials have already invited bids for consultancy services to assess the land and station development.
Urban transport activist Sanjeev Dyamannavar noted that the building of the airport line should be complemented by the completion of long-pending smaller projects like doubling of the Byappanahalli-Channasandra and Yashwantpur-Hosur line.
"Along with the airport line, the upcoming terminal at Cantonment station will become a game changer provided that the smaller projects are completed," he said.