What is gurantee system plz check my answer
Dear Student,
your answer is correct.You can also add some points as follow-
To attract more private players in rail network development, the British Company decided to provide some assurance to the companies. The assurance system was known as the Guarantee system. The government provided free land to the companies for rail network development.Two companies entered into a contract with East India Company for the construction of two small railway lines near Calcutta and Bombay respectively. With this, the Indian Railways started its modest beginnings in 1853, when the first Railway train journeyed a distance of 22 miles from Bombay to Thane.The guarantee was for a return of 5% annually, and the right for the railway company to pull out of the venture and get compensation from the government at any time. In return, the companies needed to pay to the Government when they earned more than 5%, half the surplus every year. Further, the Government had right to control expenditure and operation and to purchase railways at the expiry of 25 years
Regards
your answer is correct.You can also add some points as follow-
To attract more private players in rail network development, the British Company decided to provide some assurance to the companies. The assurance system was known as the Guarantee system. The government provided free land to the companies for rail network development.Two companies entered into a contract with East India Company for the construction of two small railway lines near Calcutta and Bombay respectively. With this, the Indian Railways started its modest beginnings in 1853, when the first Railway train journeyed a distance of 22 miles from Bombay to Thane.The guarantee was for a return of 5% annually, and the right for the railway company to pull out of the venture and get compensation from the government at any time. In return, the companies needed to pay to the Government when they earned more than 5%, half the surplus every year. Further, the Government had right to control expenditure and operation and to purchase railways at the expiry of 25 years
Regards