Indian Railways hires BCG as part of railway network upgrade

03 October 2016 2 min. read

As part of the development of India’s railway network, Indian Railways has launched a programme to upgrade 400 of the country’s A1 and A grade stations. The variation amongst economic and regional policy environments makes a ‘one-size-fits-all’ upgrade model impractical, Indian Railways has therefore hired consultants from The Boston Consulting Group to investigate the commercial potential of each station as well as their specific development requirements. The contract is worth nearly $900,000 and is set to last six months.

India has around 1.3 billion people across a vast and diverse landscape. The country is divided among 29 States and 7 Union territories, which each have a variety of regional rules around land use, taxes and infrastructure. One of the key pieces of infrastructure that crosses regional borders is the country’s vast railway network. The network has total tracks of around 89,000 km, with 7,100 stations frequented by 19,000 trains running on a daily basis.

Indian Railways hires BCG as part of railway network upgrade

As part of the modernisation of key infrastructure in India, a number of large scale investments are being made to upgrade and provide additional capacity to transport modes. One major project is to enhance 400 of the country’s A1 and A grade stations. The railway project, which has reportedly been on the back burner, was recently provided a $500 million capital loan from The World Bank, aimed at kick-starting the Indian Railways’ (IR) station redevelopment programme.

The project has run into a number of snags, however, as many of the regions in which the stations stand have a variety of different terms, ownership models and conditions covering provisions from land leases to commercial contracts. A one-size fits all model for upgrades is therefore out of context for many of the stations being redesigned.

To move the project forward, Indian Railways has hired management consulting firm The Boston Consulting Group (BCG) to investigate the conditions surrounding the 400 stations around the country to be developed, how best to go about the development as well as the specific commercial potentials of each station within the local economy. The engagement, which is set to last six months, has a value of $894,000.