Indian Railways has signed a pact with the Odisha government for setting up a joint venture company for development of rail infrastructure in the eastern state. Under the agreement, Railways will have 49 per cent stake while the state government will own 51 per cent in the JV company which will identify projects for development and mobilisation of financial resources for their execution.

As part of it, the two partners will fund part of such identified projects, it said, adding, project-specific special purpose vehicles (SPVs) would also be formed after financial closure of the project. In view of growing demands for railway lines in various states and huge requirement of funds to execute them, Railway Minister Suresh Prabhu had announced in his budget speech setting up of joint ventures with states for focused project development, resource mobilisation, land acquisition, project implementation and monitoring of critical rail projects.

As many as 17 state governments have consented to formation of JV companies for development of rail infrastructure in their respective state.