New Delhi, Feb 26 (KNN) Shri Suresh Prabhakar Prabhu has announced in his Rail Budget 2015 that the size of the Plan Budget has gone up by 52% from Rs. 65,798 crore in 2014- 15 to Rs. 1,00,011 crore in 2015-16, shares of important railway suppliers, particularly, wagon manufacturers tumbled in the share market, some upto 6%. Does it indicate any expected drop in procurement particularly of rolling stocks?
 
The budget is full of lofty projections like 50% increase in daily passenger carrying capacity from 21 million to 30 million,  increase track length by 20% from 1,14,000 km to 1,38,000 km, enhance annual freight carrying capacity by 50% from 1 billion to 1.5 billion tonnes. All these will need enormous investment in rolling stocks, for which Mr. Prabhu suggested private sector investment. Railway Minister has also planned raising finance through special purpose vehicles to be floated jointly with the State.
 
But the issue is with a critical resource gap in the economy, whether these will be feasible. Already enormous amount of Bank funds are tied up in incomplete infrastructure projects and there is no taker for PPP projects.
 
Mr. Prabhu has also proposed to partner with PSUs to ensure that sufficient capacity is built to transport critical commodities like coal, iron ore, and cement, etc. and  partner with multilateral and bi-lateral organizations and other governments to gain access to long term financing and technology from overseas. While some cash rich PSU may be goaded to participate in capital intensive Railway projects, so far foreign investment is concerned, it will depend a  lot on how easy  ‘Doing the Business’ will be. Only the other day the ambassador of Japan, the largest investor in Metro projects has rued about stifling procedures and tax regime.
 
Railway Minister also propose to invest Rs. 8686 crore in 1200 km of additional Lines which are expected to create large demand for hardwares. The Minister has also proposed 9,400 km of doubling/tripling/quadrupling works along with their electrification at a total cost of Rs. 96,182 crore over the next five years. However, neither internal resources  nor budgetary support are available for these projects and financial institutions are being approached for funding of these projects.
 
The Minister has also proposed investment in safety equipments, CCTV systems etc, which may create new opportunities for SMEs. The announcement about use of LED and other energy efficient energy devices may also create new opportunities for our LED manufacturers.
 
Railway will also promote products made by Self Help Groups, consisting mainly of women and youth which will create market opportunities for self help groups.
 
Finally, the budget projects enormous business opportunities for infrastructure as well as equipment providers but the big question is whether the Railways will be able to garner Rs. 60,000 crore from market and internal savings to fund the plan budget for the year. (KNN/DB)