The government is planning to set up a SPV for the proposed Rs.22,000 crore rail freight corridor by March 2006.The debt-equity ratio of the SPV is expected to be 70:30 ratio, to be modeled on the lines of Delhi Metro Rail Corporation.

With the proposed debt-equity ratio, the SPV would be able to raise about Rs.15,400 crore, while the rest will be provided through equity. State-owned coal, steel and power companies may also chip in with funds to finance the project.

Rites (India) is preparing a feasibility report on the corridor. Since the project is being part-financed by the Japanese government, JICA (a Japan-based consultancy) is also preparing a feasibility report from Japan's side.

JICA team on 12 November 2005 was collecting information for its feasibility reports for the first round. There will be few more such rounds, after which the process for preparing the report will start. It is likely that the SPV will start the groundwork even before JICA has submitted its report.

The project maybe included in the works programme for 2006-07 and is likely to be part of the Budget for 2006-2007.

Also See:

Feasibility report for freight corridor by December 2005 (22-Oct-05)