India Current Affairs 2017

Indian Railways signs first EPC contract with L&T to speed up electrification

The Indian Railways has signed its first EPC (engineering, procurement, construction) contract with Larsen and Toubro (L&T) for electrification of railway lines.

The contract valuing Rs 1,050 crore was awarded by Central Organisation for Railway Electrification (CORE) and Konkan Railways for electrification of 781 route kilometres (RKM). It will cover Delhi Sarai Rohilla – Rewari and Alwr – Bandikui – Jaipur – Phulera – Ajmer (353 rkm) section and Roha – Verna (428 rkm) of Konkan Railway.

Besides, eight such agreements were also exchanged between Zonal Railways and Public Sector Undertakings (PSUs) for 1,735 rkm of electrification projects valuing Rs 1,746 crore. 

Background

The EPC contracts were awarded as part of a strategy to speed up the electrification of railway lines under ‘Mission Electrification’ plan unveiled November 2016. So far only 42% of the lines are currently electrified. The Rail ministry is planning to increase its electrified network to 52,400 rkm by 2021. The Indian Railways is expecting to cut its fuel bill by Rs. 3,300 crore annually by 2020-21, by electrifying 90% of all broad gauge tracks under ‘Mission Electrification’ plan. In 2017-18 Budget, it was announced the Railways would tap the EPC route for expediting electrification projects.

Comment

Indian Railways consumes 2% of the country’s total power generation. The power could be effectively utilized in other sectors. The Mission Electrification plan will help in reducing the energy bill of railways considerably. It would also make the travel through Railways faster.

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India signs loan pact with AIIB for Rural Roads Project

India has signed a loan agreement with China led-Asian Infrastructure Investment Bank (AIIB) for financing of $329 million for Gujarat Rural Roads Project (GRRP).

 The objective of the GRRP is to improve the rural road connectivity and accessibility by providing all weather road connectivity to 1,060 villages in all the 33 districts of Gujarat, benefiting about 80 lakh people. It will also benefit the service providers such as public transport operators, hospitals, educational institutions, local markets and traders. 

About Asian Infrastructure Investment Bank (AIIB)

AIIB is a multilateral development bank backed by China, seen as a rival to the World Bank and Asian Development Bank (ADB). It was established to fund various infrastructure projects including energy, transportation, urban construction and logistics as well as education and healthcare in Asia-Pacific region.

The AIIB was officially established with 57 founding members and started to function in January 2016. But as of May 2017, the bank has 52 members. It has an authorised capital of US $100 billion. It is headquartered in Beijing.

Voting Share: China is the largest shareholder with 26.06% voting shares. India is the second largest shareholder with 7.5% voting shares followed by Russia (5.93%) and Germany (4.5%).

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