The public private partnership appraisal committee (PPPAC) under the Department of Economic Affairs, Ministry of Finance, has unanimously, recommended the following six railway line proposals for approval by the Union Cabinet.
These lines are
- Balaram-Putgadia-Tentuloi (Inner Corridor) in Odisha
- Budhapank-Tentuloi-Luburi (Outer Corridor) in Odisha
- Jajpur-Keonjhar Road-Aradi-Dhamara Port in Odisha
- Tikiri Station to Waltair Bauxite Mines in Odisha
- Manuguru–Ramagundam in Telangana
- Pakur/Nagarnabi to Godda in Jharkhand
In the minutes of the meeting held on August 1, 2026 the PPPAC made the following recommendations regarding the proposal for construction of these six new lines. The estimated project cost (excluding GST), bid project cost, capital cost and the concession period are as follows:
| Project name | Balaram -Putgadia -Tentuloi (inner corridor) in Odisha | Budhapank -Tentuloi -Luburi-outer corridor in Odisha | Jajpur Keonjhar Road-Aradi-Dhamara Port in Odisha | Tikiri Station to Waltair Bauxite Mines in Odisha | Manuguru- Ramagundam in Telangana | Pakur / Nagarnabi to Godda in Jharkhand |
| Zonal Railways / State | ECoR / Odisha | ECoR /Odisha | ECoR /Odisha | ECoR /Odisha | SCR / Telangana | ER / Jharkhand |
| Route length in Km | 49.58 | 112.56 | 101.26 | 48.96 | 207.8 | 126.52 |
| Estimated project cost (excluding GST) in INR crore | 966.9 | 2729.8 | 2763.4 | 1162.9 | 3615 | 3173.1 |
| Bid Project cost (BPC) in INR crore | 1074.4 | 3089.7 | 3091.3 | 1292.7 | 3900.6 | 3527.1 |
| Total capital cost in INR crore | 2892.4 | 8328 | 7580.5 | 3028.71 | 9985.5 | 9050.8 |
| Phasing of investment ( as percentage of project cost to be incurred) | To be implemented with construction period of 2 years year 1-65 % and year 2-35% | To be implemented with construction period of 4 years year 1-24 %, year 2-20%, year3-25% and year 4-31% | To be implemented with construction period of 3 years, year 1-25 %, year 2-35%, and year3-40% | To be implemented with construction period of 2 years year 1-50 % and year 2-50% | To be implemented with construction period of 4 years year 1-22.69 %, year 2-24.42%, year3-25.65% and year 4-27.24% | To be implemented with construction period of 2 years year 1-65 % and year 2-35% |
| Key commodity | Coal | Coal | Coal & Iron ore | Bauxite | Coal & Coke, Chemical Manure,Foodgrains, Flours, Pulses,Cement, Minerals & Ores | Coal |
| Concession period | 17 years including 2 years of construction | 19 years including 4 years of construction | 18 years including 3 years of construction | 17 years including 2 years of construction | 19 years including 4 years of construction | 17 years including 2 years of construction |
| Financial IRR % | Project IRR- 9.4 Equity IRR -14 | Project IRR- 9.63 Equity IRR -14 | Project IRR- 9.44 Equity IRR -14 | Project IRR- 9.35 Equity IRR -14 | Project IRR- 9.7 Equity IRR -14 | Project IRR- 9.45 Equity IRR -14 |
The PPPAC said that the project should be taken up under the hybrid annuity model (HAM) adding that land acquisition and necessary clearances to be obtained in a time bound manner to avoid project delay. PPPAC suggested that the implementation timelines be optimized, especially for shorter lines, given that construction of all six projects had been proposed to start from April 1,2028.
PPPAC had earlier accorded ‘in-principle’ approval to these projects under the Design, Build, Finance, Operate and Transfer (DBFOT), a commonly used PPP model. Subsequently, based on market feedback, IR revisited the project structure and proposed their implementation under the HAM.
Under the proposed HAM structure, the Indian Railways (IR) would bear the traffic and tariff risks and provide 40 per cent of the Bid Project Cost as grant during the construction period. The projects would be awarded through a single-stage, two-envelope electronic bidding process, with the lowest Bid Project Cost as the bid parameter. The first envelope is the technical bid for qualification and the second is the financial bid. Bidder eligibility would be assessed based on both financial and technical capacity.
How Hybrid Annuity Model Works
Under the HAM, IR would be responsible for land acquisition, statutory approvals and payment of 40 per cent of the Bid Project Cost during construction, while the successful bidder would undertake the design, financing and construction of the project. During the operations period, IR would operate the trains, provide rolling stock and crew, and make annuity and O&M (operation and maintenance) payments.
The successful bidder would be responsible for maintaining the project assets, undertaking station O&M and replacing assets upon completion of their codal life, except rails. Passenger and freight earnings would accrue to IR while the successful bidder would receive annuity payments, price-indexed O&M payments and limited non-fare revenue, given that the projects are primarily freight-oriented.
Other Recommendations
Other recommendations made by the PPPAC regarding provisions to be incorporated in the project bidding documents include
a. Future augmentation of railway lines, including detailed contractual provisions and appropriate safeguards for the Concessionaire. b. Revision of the exit provisions to ensure consistency in the treatment of consortium members and technically qualified EPC contractors.
c. Modification of the eligibility criteria to enable financially strong bidders lacking the requisite technical expertise to associate with technically qualified EPC contractors through legally binding agreements, including provisions governing substitution of the EPC contractor, safeguards against arbitrary replacement and appropriate penalties.
d. Rationalisation of certification process to reduce the number of stages and provide greater clarity regarding the Commercial Operation Date (COD).
e. Identification of all utility-shifting requirements, along with a clear allocation of responsibilities.
f. Inclusion of schedules in the Concession Agreement, particularly those clearly specifying the scope of work and the obligations of the successful bidder.
g. Empanelment of RDSO and other approved third-party inspection agencies to facilitate timely inspection and testing of equipment and materials.
