The hotels will be built on land leased out by the Railways Land Development Authority (RLDA). The project is anticipated to fetch Rs 4,000 crore in revenues to the ministry in 2008-09. Other real estate players, such as Unitech and Parvanath Developers, are also being roped in.

After six brainstorming sessions, the RLDA executive board has started chalking out plans for commercial development of rail land on the public-private partnership (PPP) mode. Tenders have been finalised and awarded to successful bidders at 20 locations. At nine other sites, formalities are likely to be concluded shortly The Mumbaibased consortium of GL Hotels, Signet Hotels Limited, the Zoom Royal Orchid of New Delhi are among those awarded contracts.

Ministry officials estimate over Rs 3,800 crore in revenues from the proposed 20 hotels over a period of 30 years.

Asked to ensure commercial development of vacant railway land, the RLDA has drawn up plans for developing world-class stations and budget hotels. At least 50 sites have been awarded to various consultants for conducting feasibility studies for their commercial development.

Agreements have already been signed and sealed for budget hotels at some locations, such as Chandigarh, Ooty, Kanyakumari, Pune, Mumbai (Carnac Bunder), Nagpur, Agra and Udaipur Negotiations are likely to be firmed up for nine more locations, including Guwahati, Anand Vihar, Pondicherry, Bilaspur and Raipur.

Indian Railways has thousands of hectares of vacant land. Until such time that the land is not required for the future development of Indian Railways, it has been decided to put it to various short-term uses like commercial licensing, commercial plantation, retail outlets and schemes such as Grow More Trees (GMT).