In a major initiative to address concerns of the power sector, Railways is planning to invest about Rs 4,000 crore to enhance rail connectivity to coal mines to boost fuel supplies to projects.

The measure is part of the Railways' initiative to invest up to Rs 9,000 crore for providing connectivity to ports, coal mines and iron ore mines.

Presenting the Railway Budget 2013-14 today, Railway Minister Pawan Kumar Bansal said the recently-revamped participative policy enabling partnership with ports, large mines, industry and investors addresses the specific concerns of private investors.

"The models seek to create a win-win situation by ensuring payback of investment mainly through freight apportionment.

"An investment of up to Rs 9,000 crore is expected under these projects including Rs 3,800 crore for port connectivity projects, Rs 4,000 crore for coal mine connectivity and Rs 800 crore for iron ore mines connectivity improvements," he said.

Lack of rail connectivity is among the problems faced by many companies in bringing fuel from the coal mines to their power projects. These logistical issues are also impacting overall electricity generation.

The initiative was welcomed by Coal Minister Sriprakash Jaiswal.