RITES Ltd, a multi-disciplinary public sector enterprise has joined hands with Power Finance Corporation (PFC) by signing a Memorandum of Understanding (MOU) to have right fuel and cost effective transportation system for movement of the fuel within the country and import of the same.
RITES has expertise and long experience in engineering design development & consultancy services in all facets of transport technology and infrastructure and has excellent knowledge and understanding of Indian and foreign market especially in railway, road, bridges, property development and building construction. At present, RITES is involved in the concessioning project in Tanzania and Mozambique where it is engaged in the rehabilitation, operation and maintenance of the railway network for 25 years. RITES has 51 per cent and 26 per cent stakes in these countries respectively.
PFC is a Public Financial Institution and Non-Banking Financial Company engaged in providing fund and non-fund based support to various power utilities in power sector engaged in generation, transmission and distribution of power in India. Both the parties realize that the Indian economy has grown rapidly over the past decade with corresponding increase in the demand for energy and power. To meet the ever-increasing demand and to sustain existing growth, country needs to use the available resources and power conservatively.
Coal is likely to be the main fuel for power generation as there is uncertainty as regard to availability of gas, its period and cost. In 11th and 12th plan coal and lignite based thermal projects have been identified for capacity addition. Keeping in view the availability of coal in the country, it is felt there will be a mismatch in demand and supply of coal and shortfall in the supply will have to be met through import of coal.
Under the agreement, both the parties are desirous of combining their resources and expertise to facilitate import of coal from African countries and elsewhere, subject to the parties reaching a mutually satisfactory understanding to address the problem of power deficit and to fill the demand and supply gap in availability of coal for the thermal generation plants in India.
PFC has identified funding of coal based thermal power projects as the mainstay for a long term sustainable growth of power sector and Indian economy and feels that there is a urgent need to supplement coal supplies from Indian mines that with imported coal on long term basis at competitive price. RITES, besides being a technical partner will identify the countries from where possibility of owning coal mining exists, excavation and transportation of coal is feasible for export of coal to India. RITES long overseas presence will be of immense help.
Railways constitute the major system of coal transportation in India and coal is the largest single commodity transported by the Railways. RITES being a technical arm of Indian Railways will liaison with Railway authorities for carrying and expediting sectoral studies, development of suitable plans and ensure adequate rail network for coal movement, development of new rail links with Ports connectivity.
Both the parties shall make joint efforts with concerned agencies for augmentation of port capacity to meet the increased demand, early completion of the existing projects and Port connectivity through seamless hinterland road and rail development to meet requirement of imported coal. Provide advisory services to Indian companies in acquiring mining rights. SPV, if required, would be formed which would along with local company acquire mining rights, out source the mining of coal and import the same to India for selling. Other Indian / foreign partners could also join the SPVs to be formed for the above objective, with the mutual consent of PFC and RITES whenever required.
RKS/HK/LK/TR
(Release ID :36935)