Railways will levy an airport-like fee on passengers who use its redeveloped stations, a senior official said on Wednesday. This in turn will result in a surge in fares.
User Development Fee (UDF) is a part of the taxes that are paid by an air passenger. UDF is charged at various airports and its rate varies based on various factors.
The fee will vary across the newly developed stations depending on their footfall, Railway Board Chairman VK Yadav said at a press briefing.
He said the ministry will soon notify the amount that will be charged.
The Railways have floated a request for proposal, seeking bids to redevelop Amritsar, Nagpur, Gwalior and Sabarmati railway stations at an estimated cost of Rs 1,296 crore.
The government is set to invite bids to redevelop 50 stations through the Indian Railway Station Redevelopment Corporation Ltd (IRSDC), entailing an investment of around Rs 50,000 crore in 2020-21.
"The user development fee, along the lines of a levy charged by airport operators, will be used to help fund the upgradation of stations. The charges will be nominal," Mr Yadav said.
He also said that the levy of the fee will only result in marginal increase in fares which will be compensated by user experience of world class stations.
The Narendra Modi-led NDA government had announced plans to redevelop 400 railway stations in its first term. As per the plan, the cost of station redevelopment project was to be met by leveraging commercial development of land and air space in and around the stations. The railway stations were taken up for redevelopment based on financial viability.
Government think-tank Niti Aayog in October had pulled up the ministry for delayed implementation of the station redevelopment plan. It had recommended an empowered group of top bureaucrats to develop 50 stations on priority.