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Policy to connect mines faster

Policy to connect mines faster

The Ministry of Railways has announced a new policy for con­necting coal and iron ore mines by rail. The new policy will be called R2CI—Railways’ Policy for Con­n­ectivity to coal and iron ore mines provides incentive to developers by way of return of capital; invested in the construction of the line over a period of 10-25 years through a surcharge on the freight.

Railways will also und­ertake the operations and mai­ntenance of the line at their own cost after the own­ership of the line is transferred to the Indian Railways.

The policy has two models; Capital Cost Model and the Special Purpose Vehicle (SPV) Model for flexibility. While the Capital Cost Model is relevant when there are one or two players, the SPV Model is meant to take care of a situation where there are a large number of players.

This policy will enable the parties to take up constructions of the line and be free from the worry of operations and main­tenance and is expected to hasten the development of rail network connecting the coal and iron ore belts for use.

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