Redevelopment of Railway Stations to Unlock ₹30,000 Crore Business Potential: Report
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New Delhi, Dec 23 (NationPress) The revitalization of railway stations in India is anticipated to create business prospects amounting to ₹30,000 crore for engineering, procurement, and construction (EPC) companies over the next couple of years, according to a report by ICRA published on Monday.
A total of 1,318 railway stations are under consideration for redevelopment through the Amrit Bharat Station Scheme (ABSS).
The government has boosted the budget allocation for this initiative by more than sevenfold, increasing it from ₹2,159 crore in FY2023 to ₹15,511 crore in the FY2025 Budget Estimates (BE) for Indian Railways. This funding is expected to remain robust in the medium term, as noted in the report.
Previously, the Government of India planned to execute most of these station redevelopment initiatives under the Public-Private Partnership (PPP) framework, which constituted approximately 12 percent of the National Monetisation Pipeline (NMP) target. However, due to limited involvement in the PPP approach—stemming from pricing constraints, market risks associated with real estate development, and a lack of successful PPP projects in the railway sector—the government transitioned to the EPC mode for these projects in December 2022. This shift has led to an increased budget allocation.
Vinay Kumar G., head of Corporate Ratings at ICRA, stated: “Competition in conventional areas like roads and buildings remains high, making railway station redevelopment a significant business avenue, with opportunities estimated at ₹30,000 crore for construction firms looking to expand and mitigate risks through diversification.”
“The awarding of station redevelopment projects has seen moderate competition over the past two years, with maximum discounts reaching up to 18 percent and a median discount of about 4 percent. This trend is consistent with other railway EPC projects, where the median discount is around 5 percent. Given that Indian Railways is a reliable counterparty, the receivable cycle is expected to remain short and comparable to that of the National Highways Authority of India (NHAI),” he added.
Among the stations slated for redevelopment under the ABSS, Uttar Pradesh has the highest number, with 149 stations, followed by Maharashtra with 126, West Bengal at 94, Gujarat with 87, Bihar with 86, Rajasthan with 82, and Madhya Pradesh at 80. Foundation stones have been laid for 553 stations, and over ₹20,000 crore in station redevelopment projects has already been awarded.
Currently, key stations awarded under the EPC mode include: Mumbai (Chhatrapati Shivaji Maharaj Terminal/CSMT), Ahmedabad, Surat, Prayagraj, Bangalore Cantt, Chennai Egmore, and Secunderabad. Additionally, awards for 765 stations are still pending, with significant stations like New Delhi, Pune, Borivali, Mumbai Central, Thane, and Amritsar awaiting their awards.
