Indian  Railway policy :
Manufacture of new design wagons by wagon manufacturers 
Till now, wagon manufacturers have been manufacturing wagons in accordance with standard designs prescribed by RDSO. As a result most of the wagons in use on Railways are of the design of 70s and 80s. A new policy to promote induction of wagons with modern and new designs in the Railways have been formulated. This policy makes adequate provision for simplifying the process of certifying and accepting the new wagon designs and protecting the intellectual property rights of the companies. Wagon manufacturers will now also be able to import technology from abroad to bring modern designs into the Indian Railways. This policy will facilitate continuous upgradation in the wagon technology.   
New Wagon Leasing Policy 
In order to develop the wagon leasing market, a new wagon leasing policy have been introduced under which, rail customers and container operators will be able to take wagons on lease. For getting registered under the scheme, wagon leasing companies should have a minimum net worth of Rs. 250 cr and will have to deposit Rs. 5 cr as registration fee. Registration will be valid for 20 years and will be renewable for another 10 years on rendering satisfactory services. Leasing companies have been given full rights to choose or change their lessees. These companies will lease out special purpose wagons, high capacity wagons and container wagons. 
New Wagon Investment Scheme 
The old Wagon Investment Scheme has not been popular with other than  iron-ore customers. Therefore a new liberalized Wagon Investment Scheme has been prepared. Under this scheme, investments can be made for procurement or leasing of special purpose and high capacity wagons. Freight discounts at prescribed rates will be granted for investment in special purpose wagons and high capacity wagons.
Public Private Partnership 
Railways would have to make heavy investments for the expansion of the network, modernization and upgradation of the technology and for providing world class facilities to the customers in the coming years. For this purpose, it is planned  to invest Rs. 2,50,000 cr, within the next 5 years. For funding a large portion of this plan, use of internal resources and borrowings will be resorted to. However it would be difficult to finance such a large investment programme solely from Railways own resources. Therefore, we have started many PPP schemes for attracting an investment of Rs. 1,00,000 cr  over the next 5 years. These will include projects for  provision of world class facilities at metro stations, setting up state of the art rolling stock  production units and construction of multi-modal logistics parks. Through global competitive bidding, concessions would be awarded for developing the New Delhi, Chhatrapati Shivaji Terminus, Mumbai, Patna and Secunderabad railway stations   into world class station during 2008-09. It is  expected to attract an investment of nearly Rs 15,000 cr on these stations. Through open competitive bidding, PPP partners would be selected for setting up diesel loco, electric loco and rail coach factory  at an estimated cost of Rs. 4,000 cr. It is also expected that container trains, container depot and multi-modal logistics park will attract investment to the tune of Rs. 2,000 cr. It is also envisaged that Rail Land Development Authority would raise Rs. 4,000 cr  during 2008-09 by making commercial use of  Railways surplus land. Thus concessions committing an investment  of about Rs. 25,000 cr are likely to be awarded in the year 2008-09 for various PPP projects. 
Projects through the PPP Model
In the past Indian Railways had made several attempts to rope in private participation in
areas such as catering, wagon ownership and leasing and joint ventures for rail infrastructure projects. These efforts were, however, limited in scale and scope. The current strategy is to leverage private capital through PPPs to the maximum extent in areas which are amenable to PPPs to improve efficiencies and control costs.

Operation of container trains and Construction of Private sidings, ICDs and
rail side warehouses.
IR has awarded licenses for container operations to 14 private sector companies, thus,ending the monopoly of Container Corporation of India (CCI) in this area.Most of the current parties are likely to use the operations for their internal use but dedicated third-party container operation providers might also emerge later to compete directly with CCI. These companies are involved in every step of the container business, from booking of traffic to aggregating the goods to distributing them at the destination by arranging transport. These companies would also pump in 2,000 crore to overhaul the terminals and purchase wagons.740 crore was taken from these 14 players in licence fees.In addition, Ministry of Railways intends to partner with State Governments, private logistics operators and infrastructure providers to establish multi modal logistic parks equipped with rail sidings with sheds, large inland container depots, warehouses for storage, office buildings for logistics operators, highway connectivity, and smaller assembly units for processing imported raw materials for export. Such Parks could either
be built independently at strategic locations or could be built in a Special Economic Zones (SEZs).

Construction of Dedicated Freight Corridor (Delhi-Mumbai and Delhi-
Howrah) with a large component of PPP
It has been planned to construct a new Dedicated Freight Corridor (DFC), initially covering about 2700 route kms equivalent to around 5000 track kilometers at an approximate cost of Rs.28000 crores (US$6 billion) linking the ports of western India and the ports and mines of Eastern India to Delhi and Punjab.

It will ensure multi-modal logistic connectivity and will also significantly enhance railway
freight capacity to handle the large volumes anticipated from the ports on the eastern and western coasts. The construction of this corridor will be implemented through an SPV being created for the purpose through a mix of Engineering Procurement and Construction (EPC) and PPP methods.

The proposed corporate entity would provide the rail infrastructure, but would not engage in freight business itself, thus providing nondiscriminatory track access on payment of haulage charges by train operators. This approach would herald large-scale private investment and competition in freight operations. This underlying separation of rail from wheels would also mark a paradigm shift in the functioning of Indian Railways. Ministry of Railways is in the process of selecting a global consultant to advise on the concession agreement, principles of track access charges and other financing and  bidding issues. The concessionaire could also tap additional ancillary revenue streams through commercial exploitation of land, construction of freight terminal/logistic  park/ICDs etc. Further, after firming up wagon designs for DFC, private investment for  its manufacture would be encouraged. Four more Dedicated Freight Corridors are being planned for which feasibility studies are being awarded.

High Speed Corridors
Plans are also afoot to study the feasibility of high speed passenger rail link between
major metropolises to improve connectivity and slash travel time for distances of 600-
1000 km to within 2 1/2 to 4 hours.

World Class Railway Stations, Passenger amenities
Metro City Railway Stations like Delhi, Mumbai need to be modernized to provide world – class passenger amenities and services to the large multitude of passengers using these stations. IR is planning to do so by attracting private investments in the area by allowing the areas around the stations and the air space above platform to be  commercially developed while operational/passenger – handling areas are separated from such commercial areas as in case of airports. The concessionaire would be expected to construct and maintain the operational and passenger areas free of cost,share the revenue earned from the real-estate created and hand over the same after the concession period. The pilot project for New Delhi Station is on the anvil.Altogether 19 stations have been identified at the first stage. These are CST Mumbai (Carnac Bunder), Pune, Howrah (Kolkata), Lucknow, New Delhi, Anand Vihar and Bijwasan at Delhi, Amritsar, Chandigarh, Varanasi, Chennai, Thiruvananthapuram,
Secunderabad, Ahmedabad, Patna, Bhubaneshwar, Mathura Bangalore and Bhopal. Development of other stations green field passenger terminals would also be taken up in
a similar manner.

Commmercial utilization of railway land:

Indian Railways has approximately 43,000 hectares of vacant land. These are mostly alongside track in longitudinal strips, around railway stations, and in railway colonies especially in metro and other important cities/ towns with potential of being used commercially to generate revenue as well as capital for modernization and capacity addition. An authority, namely, Rail Land Development Authority (RLDA) has been set up under the Railway (Amendment) Act 2005 to pursue, inter alia, the main objectives of generating revenue, up grading railway assets and providing world-class state-of–theart passenger facilities/services at stations.

Pipavav Railway Corporation Limited
A Special Purpose Vehicle named PRCL (Pipavav Railway Corporation Limited) which was
formed with equal equity participation from Ministry of Railways and GPPL (Gujarat Pipavav Port Limited) for construction, Operations and Maintenance of Surendranagar- Pipavav Broad Gauge line, has implemented Surendranagar - Pipavav Gauge conversion/New Line project. The construction of this line has been completed and thrown open for Goods Traffic since March 2003. Earlier, connectivity of Mundra Port on the West Coast to the Broad Gauge network of Indian Railways was completed. Gandhidham – Palanpur gauge conversion is being implemented through involvement of Kandla and Mundra ports. Kutch railway Company, SPV formed with Kandla and Mundra ports, Government of Gujarat and RVNL are equity holders.

K-RIDE
A Joint Venture named K-RIDE (Rail Infrastructure Development (Karnataka) Limited has
been formed jointly with the State Government of Karnataka for early completion of four
identified projects in the State of Karnataka. K-RIDE will execute these projects through Project Specific SPVs. First such SPV named HMRDC (Hassan - Mangalore Rail Development Co.) has been formed with equity participation from Ministry of Railways, Government of Karnataka and K-RIDE. Strategic partners and other financial institutions will also take part in the equity contribution. Besides, Government of Karnataka has agreed for funding of three rail projects by contributing two-thirds of the cost.
Wagon Investment Scheme:
The Wagon Investment Scheme (WIS) with provisions for freight rebate and supply of guaranteed number of rakes over periods ranging from 7-15 years for various categories of wagons has been well received. The scheme would be reviewed on the basis of feed back of the subscribers and continued further.
Setting up of SPV for manufacturing of locomotives/coaches/wagons
With sustained economic growth and the resultant demand for rail transport, the requirement of rolling stock has increased manifold. The requirement of coaches/Electrical Multiple Units is projected at 22689 vehicle unit for the XI Five Year Plan. The gap between the requirement and the combined capacity of the two Production Units at Integral Coach Factory, Perambur and Rail Coach Factory, Kapurthala ( around 2500 per annum) is planned to be bridged by augmenting the existing capacity of these Production Units and setting up a new manufacturing unit through a JV under PPP. Similarly, the requirement of Electric and Diesel Locomotives has been projected at 1800 each during the XI Five Year Plan i.e. 360 locos per year. The existing in – house capacity for the manufacture of these locomotives is presently 150 per annum and can be augmented to 200 locos each per annum for Electric and for Diesel. The gap between the requirement and capacity is planned to be bridged by setting up two locomotive manufacturing units one each for diesel and electric locomotives through PPP. Possibility of PPP through long- term demand guarantee to prospective manufacturers of modern wagons is also being explored.

Parcel Services
Round-trip leasing of parcel vans in important mail/express trains is already being  carried out on Indian Railways. 100 parcel vans have already been leased. A more comprehensive policy to run Express Parcel trains has been finalized. Two privately operated parcel trains are already in operation.

Catering Services, Budget Hotels and Food Plazas
Indian Railway Catering and Tourism Corporation (IRCTC) has already been mandated to develop catering services, budget hotels and food plazas at major stations through involvement of private entrepreneurs. IRCTC intends to take up around a hundred such budget hotel projects in the next five years with public Private partnership. 20 such concessions have already been awarded. The hotel will be set up under the name of Rail
Ratna in five cities - Chandigarh, Sealdah (West Bengal), Madurai (Tamil Nadu), Vijayawada and Secunderabad (Andhra Pradesh) in the first phase. The IRCTC land will be leased out to the hospitality sector on behalf of the railways and finalize the bids for 30 years to construct, operate and maintain the hotel as per the terms and conditions specified in the bid document. IRCTC is also commissioning new Food Plazas in Railway premises with private participation. The license period for food plazas is of nine years with a provision of extension of three years. Already 40 such Food Plazas have been commissioned. IR is also in the process of carrying out an examination of the scope of need- based ‘base kitchens’ and ‘launderettes’ with public private partnership to strengthen the infrastructure for on -board services.