By India Blooms News Service Sep 07, 2022
New Delhi: The Union Cabinet Wednesday approved the reduction in the railway land license fee policy from 6 percent to 1.5 percent and the lease period has been increased to up to 35 years from five years.
With this, the government has resolved the issues surrounding the divestment of Concor LLF land lease fees, rendering it attractive for private investors.
The amendment to the Railway Land Policy was awaited for a long time.
This was one of the key suggestions of the investment advisors of Concor, media reports said.
NITI Aayog had recommended keeping the railway land leasing fee for containers below 3 percent.
It will enable the strategic buyers to pay much less for a longer period of time as land rentals to railways.
In November 2019, the government had approved a 30.8 percent shareholding in the company, along with the transfer of management control out of government equity of 54.80 percent in the company. The government is planning to retain a 24 percent stake post divestment.
Container Corporation of India Limited (Concor) is under the ownership of Indian Railways, Ministry of Railways, Government of India.
Incorporated in March 1988 under the Companies Act, Concor commenced operations in November 1989 taking over an existing network of seven inland container depots from Indian Railways.
It has 61 container depots, out of which 26 are on railway land leased on a per container licence fee basis.
The Centre has budgeted Rs 65,000 crore from divestment proceeds for FY23. It is expecting to raise Rs 8,000 crore from Concor divestment as per current valuation, said reports.