According to executive director, planning, Railway Board, D P Pandey, though a decision on whether the study would be an internal one or not has not been taken, the Railways might go in for the tendering option.

Ruling out any massive privatisation plans, Pandey said, "The Railways per se is not under privatisation." He, however, added that "small efforts were being made in the areas where the Railways could make money".

He also denied that there was any conflict between the taskforce on infrastructure and the railway officials on the issue. "We are part of the taskforce and there is no question of dispute with it. A suggestion has been made by the taskforce since the Railways is short of funds but it is still on paper andneeds to be first studied and then discussed."

On divestment in its five production units, the executive director questioned the need for it. "It is not in the Railways' interest to do so. For instance, if the locomotive units are privatised then they will be the sole manufacturer and the government will be the sole buyer. The Railways will have to pay excise on it and the cost of locomotive will rise," he explained.

The locomotive units manufacture around 320 electric and diesel locomotives annually. Though Pandey claimed the Railways are the sole buyers for them, there is a huge overseas demand which is met through RITES.

The five production units are Chittaranjan Locomotive Factory, Varanasi Locomotive Factory, Integral Coach factory, Kapurthala Coach Factory and Wheel and Axle Plant at Bangalore.

Noting that the privatisation issue has to be seen in totality, he said that the ministry is open to studying it. "A decision can only be made after we know whether as a financing system, privatisation isthe option," he noted.

A committee under the chairmanship of National Council of Applied Economic Research (NCAER) director general Rakesh Mohan has been set up to suggest measures for enabling the Railways to meet the transportation needs of the economy.

The issues of privatisation and corporatisation are not directly under its terms of reference though it will identify funding source, the fiscal and policy measures needed for accessing them and prioritise investments.

Pandey said a beginning had already been made in partnership with the private sector and the state governments.

The Railways entered into a joint venture with the Gujarat Pipavav Port for implementing a Rs 350-crore project. A similar partnership is being worked out with Mundhra port.

In respect of states, the Orissa Minning Corporation entered into a joint venture with the Railways and an Australian company for developing a railway line.

A proposal from the Uttar Pradesh government for running sub-urban services has also come in.The state government had earlier declared that it would take a 26 per cent stake in all new lines developed in the state.

"We have also envisaged partnerships in catering and tourism," he pointed out. The Railways has recently awarded the contract for two tourist trains to Sterling Resorts. It is not offering any more routes in the near future.

"Even the private sector wants to work out the economics of running a train," said Pandey.

On commercial utilisation of railway land, Pandey admitted that not much success has been achieved in this respect. "Unfortunately, the timing was wrong since land prices have dipped," he said.

The own-your-wagon scheme, BOLT routes and telecommunication network are other areas of private partnership.