Suresh Prabhu Addresses as Key Speaker at World Bank – Singapore Infrastructure Finance Summit 2015

Suresh Prabhu Addresses as Key Speaker at World Bank – Singapore Infrastructure Finance Summit 2015 

 Railway Minister Concludes His Two Day Singapore Visit Holding Discussions with Varied Governmental and Industry Leaders  

Railway Minister’s Different Interactions Focused on Enhancing Inflow of Funds for India’s Infrastructure Development, Modernization and Expansion Plans of Indian Railways and Investment Opportunities in the Indian Rail Sector

The Visit Gives Fillip to Cooperation Between the Two Countries in the Field of Infrastructure Development

Minister of Railways Shri Suresh Prabhakar Prabhu visited Singapore to participate as a key speaker during the Infrastructure Finance Summit 2015 organised on 20^th October 2015 by the World Bank in association with the Government of Singapore.  Shri Suresh Prabhu was specially invited by Deputy Prime Minister of Singapore, Mr Tharman Shanmugaratnam to share experiences on the instrumental work that Indian Railways is doing in Infrastructure financing. 

 Organised by the World Bank Group, the Singapore Ministry of Finance, the Monetary Authority of Singapore and the Financial Times, the Summit witnessed the presence of economists, thought leaders and other experts who discussed the current and future economic and financial environment with a particular focus on the opportunities and challenges in the major, dynamic economies of South and Southeast Asia. Indian Railway Minister, Shri Suresh Prabhu who was a panel speaker at the Summit spoke about the major transformation being undertaken in Indian Railways including the re-development of Railway stations.  The Summit provided a good opportunity to policy-makers and leading minds in finance to discuss the latest global initiatives, the approach of institutional investors and other private funders, the opportunities and obstacles that exist on the ground in Asian emerging economies, and the most effective strategies to accelerate progress in the current volatile economic environment.

Besides attending and speaking at the 6^th World Bank - Singapore Infrastructure Finance Summit, Indian Railway Minister Shri Suresh Prabhu had a very hectic and busy schedule during his two day official visit to Singapore holding wide range of discussions with a cross section of individuals, local government functionaries and institutions; investment, industry, business leaders and groups.  During the Summit and during different interactions, Shri Suresh Prabhu among other things focused on enhancing inflow of funds for infrastructure development in India, modernization and expansion plans of Indian Railways, investment opportunities in the Indian Rail Sector etc. The visit was extremely successful and it has given a big fillip to mutual cooperation between the two countries in the field of infrastructure development. 

            Following is the brief report about various engagements of Indian Railway Minister Shri Suresh Prabhu during his two day (20-21 October, 2015) Singapore visit : -

Ø  Abraaj Annual Forum Meet. Indian Railway Minister Shri Suresh Prabhu Hon’ble Minister attended the Abraaj Annual Forum Meet where Hon’ble Deputy Prime Minister of Singapore, Shri Tharman Shanmugratnam spoke about challenges being faced by the economies especially due to economic slowdown in China and the pace of new technological developments.

Ø  Luncheon meeting with Hon’ble Minister for Foreign Affairs of Singapore, Dr Vivian Balakrishnan.

Shri Suresh Prabhu had a luncheon meeting with the Singapore Foreign Minister on 20 October, 2015, where discussions took place on possibilities of collaboration in development of India Railway stations.  

    

Ø  Interview with James Kynge of Financial Times. Shri Suresh Prabhu gave an interview to Mr James Kynge, Emerging Markets Editor of Financial Times. 

Ø  Meeting with representatives from Singapore Airlines : Shri Suresh Prabhu had a meeting with Mr Goh Choong Phong, CEO and Mr Tan Kai Ping, Senior Vice President of Singapore Airlines in which the Minister apprised the Airlines representatives with the potential of Indian railways and the various projects such as creating a dedicated freight corridor to reduce the congestion of traffic as well as enhancing the efficiency of the passenger corridor. On being asked about private participation in Indian Railways sector, Shri Suresh Prabhu told that various activities and services are outsourced to private players and private investment is sought under various schemes for railway infrastructure development.  The Minister also mentioned that given the present global economic scenario where US and Japan are not doing well on economic front, Chinese economy is slowing down, India holds a promising future and aims at reaching a double-digit growth in future especially after introduction of GST.

Ø  Meeting with representatives of GIC Group. The Indian Railway Minister had a meeting with Mr Boon Chin Hau, Senior Vice President and Mr Sid Chandrasekaran, Assistant Vice President, GIC Infrastructure Group. Formerly known as Government of Singapore investment company, GIC is a sovereign wealth fund established to manage Singapore’s Foreign Reserves.  It is one of the few global firms with highest credit ratings.  GIC invests internationally in fixed income, equity, real estate and special projects.

  Explaining the Indian Government’s decision to open up the Railway to private stakeholders, Shri Suresh Prabhu stated that the Indian Railways has got a constant stream of income to provide reasonable facilities and comforts to the people travelling on rails from sources such as provident funds, insurance etc. However, GIC could perhaps participate in upgradation of railway in terms of horizontal expansion of existing stations, constructing malls, offices above them, track-laying, creating separate freight and passenger corridors to reduce decongestion etc by adopting equity route and work with Indian companies on zero-risk basis with an assured financial return. 

Ø  Meeting with representatives from Temasek.   The Indian Railway Minister Shri Suresh Prabhu had a meeting with Mr Rohit Sipahimalani, India Head and Ms. Juliet Teo, Managing Director of Temasek Group. Temasek holdings is also an investment company owned by Govt. of Singapore.  Its portfolio of $177 bn covers broad spectrum of sectors including financial services, telecommunications, media, consumer, transportation and real estate. 

The Minister explained various programmes which the Government is working upon towards modernization of Indian Railway as well as the investment opportunities the Government is contemplating to provide to the private investors. Mr Rohit asked how does the Minister think on aligning the two corridors (freight and passenger) and whether both could fruitfully co-exist. The Minister optimistically replied ruling out any possibility of conflict between the two corridors and stressed that, in fact, the two corridors could co-exist in a healthy relationship complementing each other by cross-subsidization. When asked what challenges the Government is facing towards modernization of Indian Railway, the Minister replied that though the challenges are there, however, the Government looks forward to overcoming those challenges in next 3 and half years.

   

Ø  Meeting with Amb Gopinath Pillai(Ambassador-at-large for the Government of Singapore). Shri Suresh Prabhu had a meeting had a meeting with Amb Gopinath Pillai as well in which matters pertaining to technological cooperation between India and Singapore especially in the field of training and skill development were discussed.

Ø  Meeting with representatives from Land Transport Authority (LTA) of Singapore Government. Shri Suresh Prabhu met Mr. Chew Men Leong, Chief Executive, Ms. Sim Wee Meng, Senior Group Director and Mr V. Venkataraman, Director, Cost Control of LTA, Singapore. Having given a brief idea on Railway system in India including its various modernization programmes such as upgradation, creating separate corridors for freight and passengers, vertical expansion of existing Railway stations, track-laying etc, the Minister sought LTA’s interest whether they could participate in the modernization bid of Indian Railway.  The Minister said that relevant information would be shared with them and they would be informed about the bids through the High Commission.

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Railways Fast Tracks Implementation of Projects 

Ministry of Railways included 77 doubling, 4 new line and 1 gauge conversion project in Railway Budget 2015-16.  The projects were included primarily with a viewpoint to create additional carrying capacity.  Fast tracking of these projects was need of the hour so as to reap benefits of the projects as soon as possible. Under direction of Minister of Railways Shri. Suresh Prabhakar Prabhu, a number of measures have been under taken for expeditious execution of these projects:

(i)      So far the practice was to include a project in railway budget and send for ‘In Principle Approval’ (IPA) of NITI Aayog, hold meetings of Extended Board of Railways and finally seek approval of Cabinet (CCEA).  Once Cabinet approval is available, Railways used to go for Final Location Survey and subsequent preparation of Detailed Estimate.  An expenditure can be incurred only after Detailed Estimate or part thereof has been sanctioned.  This process used to take 2-3 years, which means tenders can be called roughly after 2 years of inclusion in Railway Budget. 

(ii)    To reduce this time gap of two years, Ministry Railways asked zonal railways to carry out Final Location Survey immediately after inclusion of the work in Railway Budget. After Final Location Survey, the zonal railways were asked to send Detailed Project Report (DPR) to Railway Board with a reasonably firm cost.  Out of 77 doubling projects sanctioned in this year, detailed project reports of 73 doubling projects has been prepared and received in Railway Board.

(iii)   Examination and scrutiny of DPR in Railway Ministry has been fast tracked by forming committee of concerned officers for this purpose instead of examination from table to table by individual officer.   

(iv)  Request for ‘In Principle Approval’ (IPA) of NITI Aayog is being sent after DPR is examined in Railway Board.  As many as 15 IPA have been received from NITI Aayog.  Out of these 15 IPAs, 4 projects which cost more than Rs.1000 cr. are being sent to CCEA for approval. 

(v)    Zonal Railways have been advised to call tenders immediately after IPA is received.  However, a financial commitment can be made only after all requisite approvals are in place. 

(vi)  To obviate delays further, Railways are now being advised to invite tenders immediately after a DPR is sent to NITI Aayog for IPA without waiting for approval.

(vii) This has effectively reduced tender calling period from 2 years after inclusion of a project in Pink Book to 6-9 months. 

(viii)           In addition to this, zonal railways have been given more powers to sanction detailed estimates so as to reduce delays in such sanctions.

(ix)  Power for accepting all tenders have now been delegated to zonal railways which results into overcoming delays on this account.