LAHORE, Dec 23: Reacting to a report "Railways lease out land for a paltry sum", a Pakistan Railways statement said on Thursday that the land was not leased against one time advance of Rs1.2 million.

It said the PR AGM freight signed an MoU with M/s Ring International through its representative Sheikh Muhammad Fazal Rahim. The MoU was signed in line with government policy to involve private sector in operation of freight trains for transportation of container cargo to enhance the revenue earning.

Access of track is to be provided by Pakistan Railways to the company for a period of 30 years besides providing a suitable land for stacking purposes on usual terms and conditions.

M/s Ring International was accordingly leased railway land measuring 22.24 kanals at Faisalabad station for stacking of the steel material to be transported by the party as per railway's policy. An agreement was signed with the representative of the company in June, 2003.

The possession of land was handed over on the receipt of security money of Rs2,421,936. The annual rental of the land leased purely for the stacking purposes is Rs2,421,936 per annum. The Pakistan Railways will earn an amount of Rs72.66 million in the form of rent without losing anything.

The statement said the PR administration had already advised its field staff that no construction of any kind might be allowed at site without the prior approval of the PR administration.

"Besides, notice boards have been conspicuously displayed at the site warning the general public that the said land cannot be sub-leased. The lessee has already been served with a notice for defaulting on the agreement." It said that it is customary that whenever a federal government department signs an agreement, it is done in the name of the President of Pakistan.

OUR FAISALABAD CORRESPONDENT ADDS: Dawn stands by its story.