The government has set in motion the incorporation of a Joint Venture Company (JVC) between the State and Railways for cost-sharing of “viable” railway projects by appointing the Chief Secretary(CS) as chairman of the proposed JVC.
The government has also given its nod to provide Rs.51 crore as the State’s share towards the initial equity to the JVC as per an agreement signed between the State and Railways in New Delhi on September 1. Railways will have to provide Rs.49 crore as their initial equity share.
Byju Ramachandran, a practising Company Secretary, has been appointed Company Secretary of the JVC, which will have its headquarters in the State capital as insisted by Railways, official sources told The Hindu . A committee comprising representatives of the Ministry of Railways and the State government in equal numbers will be set up for the selection of the Managing Director.
MD’s post
While the Chief Secretary will be the part-tine chairman of the proposed JVC, the Managing Director will be a full-time post and will have to run the show. The State government has given directions to the Transport Department to advertise the post of MD.
Two full-time directors, one financial expert from the State government and one technical person from Railways will be appointed. The Secretary, Finance, and the Secretary, Transport, have already been appointed as non-full-time Directors from the State.
The Transport Department has written to Railways to forward the names of their nominees to the board. Two other independent Directors will be appointed from the public or the private sector or educational institutions who will be experts in their respective fields.
The project
The JVC is for undertaking project development, financing, and implementing identified rail infrastructure. As per the MoU, the State will have 51 per cent equity share and the Railways 49 per cent in the company, which will have an authorised share capital of Rs.200 crore with the initial paid up capital of Rs.100 crore.
Commercially viable projects identified jointly will be entrusted to the separate project SPVs for execution on a fast-track basis.
