New Delhi, Jan 7: The Konkan Railway Corporation Ltd (KRCL) may soon find some succour from its financial problems. The ministry of railways is preparing a financial package for KRCL and will be approaching the ministry of finance with the same shortly.According to a senior official, discussions are still going on within the Railway Board for working out details of the package which is likely to provide a long-term solution to bring the railway undertaking out of the debt-trap.
The ministry of railways is providing interest free loans to meet the interest obligations of the corporation. It has already extended a loan of Rs 200 crore in 1999-2000 and Rs 324 crore during 2000-2001 to the corporation in order to ensure the timely payment of interest on loans.
Though KRCL is making operating surpluses, it is not able to meet the debt liabilities arising out of loans taken during construction. The finished cost of the project was Rs 3,550 crore. Its debt burden includes $115-million foreign currency loans raised in two tranches. These loans are supported by guarantees from the ministry of railways. KRCL's debt servicing is estimated to be Rs 270 crore.
The governments of Maharashtra, Kerala, Goa and Kerala have together put in 49 per cent equity in the corporation which has an authorised share capital of Rs 806.47 crore and paid-up capital of Rs 772.8 crore. The remaining 51 per cent has been put in by the Central government.
The governments of Maharashtra and Goa have not fully contributed towards their share of equity and the balance equity yet to be paid by these governments is Rs 21.77 crore and Rs 7.24 crore, respectively.
The board has also asked Konkan Railway to maximise generation of internal resources so as to be able to meet its obligations. The railway undertaking has the capacity to move at least 14 freight trains each way along the 760 km track stretching from Panvel in Maharashtra to Mangalore in Karnataka.
However, freight business did not materialise as per expectations and the corporation was making Rs 40 crore losses monthly till last year as the 760-km track was utilised only 40 per cent.
This year, the corporation is confident of improving its earnings. During April-November 2000, the corporation recorded a Rs 12 crore increase in revenue. While passenger earnings rose Rs 5 crore, freight earnings increased Rs 7 crore.
Earning from engineering projects, which the corporation has started undertaking to supplement its revenues, will also start flowing in this year.
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
