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Mint Explainer| Why Indian Railways is betting on new public-private partnership models?
Indian Railways has a massive investment requirement at a time when its internal revenue generation has remained largely stagnant. Will the new models help it overcome challenges?
Indian Railways is broadening its public-private partnership (PPP) framework amid largely stagnant internal revenue generation and the railway ministry’s preference for government budgetary support over additional borrowing.
A parliamentary committee has welcomed the renewed push to attract private investment, while calling for commercially viable projects, better risk-sharing mechanisms and faster approvals. Why is Railways pushing PPP initiatives, and what does it mean for the national carrier? Mint explains.
This has increased the importance of gross budgetary support (GBS) from the government. While GBS remains the principal source for major railway investments, PPPs offer a way to supplement public funding without making every project dependent on government expenditure.