Railway Station Renewal Scheme: Judicious Resource Allocation Key To Success

Many prominent stations in both bigger and smaller cities are unable to handle the increasing rush of passengers, provide easy entry/exit, or offer quality services such as well-managed waiting lounges, spacious concourses, clean drinking water, washrooms, etc.

So, when the Indian Railways floated the idea of a station redevelopment programme in 2016, (later renamed as Amrit Bharat Station Scheme in 2023), it was seen as a worthwhile initiative by most stakeholders.

Beginning with a list of 125, today 1,321 railway stations have been shortlisted for redevelopment out of approximately 7,000 stations across the country and work has already started on several of them.

Under the scheme, the Railways have decided to transform these stations with a host of facilities on the lines of airports. The plan is to expand stations with available unutilised railway land, add more floors to the main building to create space for facilities and promote the cultural heritage of the respective cities by showcasing their uniqueness in the architectural design of station buildings.

Current Status

Since the launch of the scheme, three stations—Gandhinagar in Gujarat, Rani Kamalapati (earlier Habibganj) in Bhopal and SMVT in Bengaluru—have been fully revamped and several other stations have been taken up for redevelopment.

While initial work has been completed in some stations, others which have been recently added to the scheme, are still in the foundation-laying stage.

For instance, the first phase of the redevelopment of Ayodhya Dham Station in Uttar Pradesh has been completed and the work for the second phase has started.

Gandhinagar was the first station to be fully re-developed in 2021 under a collaborative effort by floating a joint venture company –  Gandhinagar Railway and Urban Development Corporation Ltd (GARUD) – with equity contribution of the state of Gujarat (74%) and Indian Railway Station Development Corporation (26%).

GARUDA along with redeveloping the Gandhinagar railway station also developed a hotel on the airspace above the station as part of the same redevelopment project. Also, it looks after the management of the Mahatma Mandir (an exhibition centre) and a Helipad.

Experts associated with the project point out that it is a small station where around ten trains operate daily. Hence the footfall is limited, and the pressure on facilities and services is manageable, resulting in better cost management.

Operative Costs Are A Challenge

However, that has not been the case with the Kamalapati station, which was rebuilt on a PPP model with a Rs 100 crore investment.

People associated with the project said that while the redevelopment cost escalated, the revenue generation remained a challenge. Private players, as a consequence, didn’t come forward to participate in the redevelopment of other stations and the Railway has had to put in its own money into the scheme now.

According to the initial plan of 2016, the Railway was supposed to enter into a PPP agreement with private players for redevelopment and leasing out of commercial space to earn money to meet the operative cost but this posed many challenges in the case of Rani Kamalapati station.

“After the station was rebuilt, the private contractor increased the parking charge to Rs 500 per car to get more revenue. People, instead of parking their car at the station, now drop the visitor outside the station gate and drive away to save money,” an official employed at the station said, adding that the first contractor left the work selling his rights to another private party.

There are reports of poor sanitation in the common areas and stinking washrooms at the station which was launched with fanfare and hyped as having world-class standards.

Officials say that the daily operative cost has gone up four times more than what it used to be before the redevelopment work and that generating revenue to meet expenses has become a challenge.

“We should be mindful that in our country, people show the least regard for keeping public areas clean. So either you deploy more staff for that purpose or take stringent action. Either way, this requires more manpower which increases operational costs,” said Amit Jain, a Delhi-based construction consultant.

He added, “In Tier 2 and Tier 3 cities, we don't need world-class stations but a station with good passenger amenities and with a self-sufficient business model to manage its day-to-day affairs.”

The maintenance issue was also flagged by the Committee on Estates in a report submitted to the Lok Sabha in early February this year.

Highlighting other issues such as the need for a dedicated budget and robust selection process of stations for redevelopment, the Committee said, while realising the need for regular and better upkeep of stations, that the Railway Ministry should revise the guidelines and include maintenance as an integral part of the upgradation contract for a minimum period of five years.

Is Renting Out Commercial Space A Solution?

Sensing the challenge of its business model, the Railways decided to do commercial development of the airspace above the railway station or on the unutilized land around the station area which could be leased out to private players to earn money.

“The revenue collected from leasing out of the commercial area will be utilized to meet the operative cost of the redeveloped stations,” R Nand Gopal, Deputy Chief Engineer, Madurai Division, who is in charge of the redevelopment of Madurai Railway Station, said.

The redevelopment schemes of a majority of large stations have been designed in such a way that the station buildings would have multiple floors, out of which, top floors would be leased out to offices, financial institutions, and commercial establishments.

According to Gopal, in the redevelopment concept, the Railways want to attract shoppers and visitors who might not be passengers and stations have been designed in such a way that the smooth flow of passengers will not be impacted by the pure shoppers.

Railway officials are upbeat about this revenue model as they believe that many stations are very strategically at the heart of cities and hence commercial spaces and malls there can earn good money.

However, a section of experts believe that such revenue models might be successful in some places but not in all. Also, according to them, many stations in smaller cities don’t need amenities of world-class standards but of basic standards.

They also say that there is a need to factor in the financial profile of the city and people as revamping stations similar to the airport will end up being a waste of resources.

For instance, Badampahar railway station, a rural area in the Mayurbhanj district of Odisha, where the Railways laid the foundation stone for redevelopment work in November last year, needs only basic services such as public utilities, clean drinking water, proper restrooms, etc. However, the Railways went ahead and announced plans to create world-class facilities at par with other big stations.

The only importance of this place is that it is 13 km away from the village Uparbeda which is the birthplace of the President of India Droupadi Murmu. At present a small station is there which fulfils the needs of the villagers.

Under the scheme, many tier 2 and tier 3 stations are proposed to have air-conditioned common areas, waiting lounges and food plazas just like an airport.

Consultants associated with the project say that the government should be aware that there is a difference in the financial status of people who visit airports as compared to Railway stations.

“Railways need to spend its resources judiciously as there are various other priority areas such as safety. Enhancing basic facilities for the passengers is a good step but creating luxury infrastructure will not serve any purpose as its upkeep will be a challenge for the organisation,” Shiv Gopal Mishra, General Secretary, of All India Railwaymen’s Federation, said.