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Works, including track renewal, doubling, construction of bridges and embankments, on the railway network in the State which were hit by railway contractors’ strike against the high Goods and Services Tax (GST) rates will return to the fast track only after six months.
Though the nationwide strike called by the Southern Railway Contractors’ Organisation (SRCO) and Indian Railway Infrastructure Providers Association (IRIPA), a body representing contractors working on infrastructure projects with Indian Railways has been called off, normality will be restored only by December as all ongoing and tendered works were stalled and the labourers went home.
“Though the works resumed in other States from September 2, the Bakrid-Onam season in the State delayed the commencement of works here. Urgent works on railway tracks and trains have commenced. But, normalcy and pace will be restored only in the next three months,” Alex Perumalil, SRCO president, said.
The urgent works on the railway network had been given priority taking into account the safety of the commuters and the trains. The other works like doubling of railway track and track renewal have commenced, Mr. Perumalil said.
The 100-odd railway contractors are up in arms against the increased tax liability on ongoing projects awarded to them before July 1 this year and under various stages of execution. The contractors are demanding more money for the contracts due to increased tax liability following the introduction of GST.
The contractors are demanding that the enhanced liability on account of GST be either borne by Railways or the contracts be closed without financial implications on either side. In Kerala alone, the contractors are executing ₹600-700 crore works awarded to them in Thiruvananthapuram and Palakkad divisions before July 1.
The stir was suspended after Railway Board Chairman Ashwani Lohani wrote to the Union Finance Secretary Ashok Lavasa seeking concurrence on neutralisation on the impact of GST in the works awarded before July 1. A three-member committee of Executive Directors also favoured neutralisation. Though the contractors have resumed work, they are adopting a cautious approach as the Finance Ministry is yet to take a call.
This article first appeared on www.thehindu.com
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