India is likely to approve tweaking the Railway Land Licensing Fee policy in June, paving the way for sale of state-owned Container Corporation of India, according to two government officials.
Last month, officials from Department of Investment and Public Asset Management, NITI Aayog, Concor, and the Indian Railways met to provide concluding inputs for the policy to the cabinet, the first government officials said on the condition of anonymity because the details are not public yet. It was proposed to cut licensing fee from 6% of the land value to either 1.5% or 3.5%, the official said.
The divestment process of Concor would begin once the licensing fee policy gets approval from the cabinet, the second official quoted earlier said. Expression of interest will most likely be floated by the end of July, the official said.
BQ Prime awaits a response to queries emailed to the Ministry of Railways, Department of Investment and Public Asset Management, NITI Aayog and Concor.
Higher land lease fees make the national container transporter less attractive to private players as the government looks to sell its 30.8% stake in India's largest containerised rail cargo provider. The government is looking at assets it can successfully monetise after missing divestment target in 2021-22. Concor along with Bharat Petroleum are among the companies up for strategic sales after Rs 24,046.4-crore the initial public offering of Life Insurance Corp.
Of Concor's 61 container terminals, 26 are on railway land. And it earlier paid the fee based on the volume or twenty-foot-equivalent units of railway land it leased. From April 2021, Indian Railways charged 6% of the industrial land value per acre as fee, and it would be raised to 7% annually to factor in inflation.
BQPrime had earlier reported that the cabinet is in discussions to bring down licensing fee to 1.5% of the market value of railway land.
The new railway land leasing fee policy will be applicable to both government departments as well as private players, the second official quoted earlier said. Earlier, it applied only on land licensed by government departments for industrial purposes.
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