K-Rail to increase non-fare revenue by 15-20% by acquiring more land

Although the Detailed Project Report (DPR) of the SilverLine Semi-High Speed ​​Railway project reveals the generation of 5% non-ticketing revenue through other means, the Kerala Rail Development Corporation Ltd (K- Rail), a joint venture implementing the project, expects to generate around 15-20% of non-ticketing revenue by acquiring more land beyond the station areas.

Talk to The Hindu, a senior officer close to K-Rail said after reviewing the DPR, the Niti Ayog, the Centre’s top government think tank, stressed the need to generate 15-20% non-ticketing revenue in accordance with the international standard to make the project economically viable. In countries like Japan, non-ticketing revenue accounts for around 40% of total revenue.

“In Kerala, we have limits to increase non-tariff revenue beyond a certain limit, but K-Rail hopes to increase non-tariff revenue by around 15-20% in the initial phase by establishing a land bank, by acquiring more land beyond. the station area. K-Rail authorities recently launched a tender to assess the feasibility of generating non-fare revenue. Although the company was selected, the award of the contract did not take place given the current dispute. But this is part of the project and we will do the assessment once the social impact assessment is complete,” the source said.

Indeed, according to the DPR of the SilverLine, approximately 1,383 ha of land must be acquired for the project, including 1,198 ha of private land and 185 ha of railway land. However, the actual extent of land needed for the project will be far greater than the 1,383 ha ultimately projected, as land acquisition beyond the stations in 11 districts is not sufficient for K-Rail to generates 15-20% non-ticketing revenue in the preliminary analysis.

K-Rail authorities plan to train two Special Purpose Vehicles (SPV) for the execution of the project. The first SPV would handle the execution of the project, while the second SPV would be mandated to generate maximum non-ticket revenue by acquiring more land beyond the station areas. K-Rail is of the view that if 15-20% of total revenue is collected through non-fare means, tickets for passengers on semi-high speed trains could be offered at subsidized fares.

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