WorkingGroups04

IDENTIFYING INVESTMENT AND FINANCIAL INSTRUMENTS FOR RESOURCE MOBILIZATION FOR TAR NETWORK: 

IDENTIFYING INVESTMENT AND FINANCIAL INSTRUMENTS FOR RESOURCE MOBILIZATION FOR TAR NETWORK PROJECT GUIDES: Dr. RAM CHANDRA RAI (Sr. Prof. Finance) Shri K. L. DIXIT (Sr. Prof. Transportation) GROUP 4 1. BERNADETTE E. S. MAYASHANTI (INDONESIA) 2. D. M. A. S. W. MUNASINGHE (SRI LANKA) 3. NATHAPON SUKWINYA (THAILAND) 4. NGO TRUNG KIEN (VIETNAM) AUGUST 2006 RAILWAY STAFF COLLEGE, VADODARA, INDIA

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OBJECTIVES To identify investment requirements of TAR Network To examine the existing pattern of funding To suggest future sources and instruments of funding

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INDONESIA * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year

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INDONESIA (contd.) Government National Budget (via MoT) Multilateral and Bilateral Funding (via MoT) State Owned Enterprise’s Own Budget CURRENT PATTERN OF FUNDING Railway act does not allow private investment in railway projects directly The state budget for the investments as well as company’s budget is not sufficient CONSTRAINTS Private investment Public Private Partnership (P3) Public Public Partnership Local Government Investment ADDITIONAL SOURCES ENVISAGED

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MALAYSIA * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year

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MALAYSIA (contd.) Government National Budget State Owned Enterprise’s Own Budget CURRENT PATTERN OF FUNDING Railway act does not allow private investment in railway projects directly The state budget for the investments as well as company’s budget is not sufficient CONSTRAINTS Public Private Partnership (P3) ADDITIONAL SOURCES ENVISAGED

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THAILAND * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year

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THAILAND (contd.) Government Support Multilateral and Bilateral Funding Public Private Partnership CURRENT PATTERN OF FUNDING Railway act does not allow private investment in railway projects directly The state budget for the investments as well as company’s budget is not sufficient CONSTRAINTS Private Investment ADDITIONAL SOURCES ENVISAGED

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CAMBODIA * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year

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CAMBODIA (contd.) Private Banks with Government Support Multilateral and Bilateral Funding Public Private Partnership CURRENT PATTERN OF FUNDING Railway act only allow private investment in railway projects by joint ventures The state budget for the investments is not sufficient CONSTRAINTS Private Investment ADDITIONAL SOURCES ENVISAGED

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VIETNAM * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year

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VIETNAM (contd.) Government Support Multilateral and Bilateral Funding CURRENT PATTERN OF FUNDING Railway act does not allow private investment in railway projects directly The state budget for the investments is not sufficient CONSTRAINTS Private Investment Public Private Partnership ADDITIONAL SOURCES ENVISAGED

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LAO PDR * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year

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LAO PDR (contd.) Government National Budget (MoT) Bilateral Funding (Thailand) CURRENT PATTERN OF FUNDING Railway act does not allow private investment in railway projects directly The state budget for the investments as well as company’s budget is not sufficient CONSTRAINTS Public Private Partnership (P3) ADDITIONAL SOURCES ENVISAGED

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MYANMAR * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year

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MYANMAR (contd.) Government National Budget Multilateral and Bilateral Funding CURRENT PATTERN OF FUNDING Railway act does not allow private investment in railway projects directly The state budget for the investments is not sufficient CONSTRAINTS Private Investment Public Private Partnership (P3) ADDITIONAL SOURCES ENVISAGED

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INDIA** * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year ** Except for India, Sri Lanka and Bangladesh, the computation of figures done on the basis of UNESCAP study on Trans-Asian Railway in the Indochina and ASEAN Sub Region

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INDIA (contd.) Budgetary Support: - Remuneration Projects Fund at 7 % - Non Remuneration Projects getting Interest Free Capital from Government Internal Resources Leasing Finance – Indian Railway Finance Cooperation (IRFC) for Rolling Stocks Public - Public Partnership Public - Private Partnership CURRENT PATTERN OF FUNDING Indian Railway can not borrow directly from the outside CONSTRAINTS Additional Special Purpose Vehicles (Companies) Corporatization of Non Core Activities – Indian Railway Catering and Tourism Corporation for Catering and Tourism ADDITIONAL SOURCES ENVISAGED

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SRILANKA** * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year ** Except for India, Sri Lanka and Bangladesh, the computation of figures done on the basis of UNESCAP study on Trans-Asian Railway in the Indochina and ASEAN Sub Region

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SRILANKA (contd.) Government National Budget Multilateral and Bilateral Funding CURRENT PATTERN OF FUNDING Railway act does not allow private investment in railway projects directly The state budget for the investments is not sufficient CONSTRAINTS Public Public Partnership Public Private Partnership (P3) Property Development ADDITIONAL SOURCES ENVISAGED

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BANGLADESH** * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year ** Except for India, Sri Lanka and Bangladesh, the computation of figures done on the basis of UNESCAP study on Trans-Asian Railway in the Indochina and ASEAN Sub Region

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BANGLADESH (contd.) Government National Budget Multilateral and Bilateral Funding State Owned Enterprise’s Own Budget CURRENT PATTERN OF FUNDING Railway act does not allow private investment in railway projects directly The state budget for the investments as well as company’s budget is not sufficient CONSTRAINTS Private Investment Public Private Partnership (P3) ADDITIONAL SOURCES ENVISAGED

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TOTAL TAR - PROJECT COST * The figures for the period 2006 - 2025 have been enhanced by 50 % taking 5 % inflation per year ** Except for India, Sri Lanka and Bangladesh, the computation of figures done on the basis of UNESCAP study on Trans-Asian Railway in the Indochina and ASEAN Sub Region

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RECOMMENDATIONS Government National Budgets Multilateral and Bilateral Funding State Owned Enterprise’s Own Budget Public - Public Partnership Public - Private Partnership Establish Specialized Financial Institution for Rail Transport in TAR Region Establish Specialized Financial Institution for Rail Transport by Each Member Country Taking Rolling Stocks on Lease from Private Sector

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RECOMMENDATIONS (Cont.) Sources of Funding of Specialized Financial Institutions Equity Support by Member Countries Deep Discount Bonds from Public Direct Borrowing from Multilateral Agencies Borrowing from Pension Funds Borrowing from Insurance Companies Technical Experts/Consultants for Advising Member Countries

SUKRIYA : 

SUKRIYA