Events & Issues
New Delhi, 10 May, 2017
Transforming
Railways
GOVT ON
THE RIGHT TRACK?
By Dhurjati
Mukherjee
The recent Cabinet approval to set
up an independent regulatory authority augurs well for the Railways, which has
for quite some time facing severe financial problems. The authority would
recommend revision of tariffs and passenger fares, which successive Governments
have shied away from taking as unpopular decisions, forcing the Railways to
bear loss of around Rs 36,000 crores every year in subsidising the passenger
segment. The regulator, Railway Development Authority, is expected to lay down
principles for determining tariff in passenger and freight segments.
The regulator will also ensure fair
play and a level playing field for private or foreign players. Private
investment in the Railways has been low due to uncertainties and frequent
policy changes. As such, it is also expected to frame principles on subsidy or
social service obligations benefitting the aam
aadmi as the higher income group will have to support services for the
common man.
It is understood that the authority
may additionally be empowered to make suggestions on policies for private
investment to ensure reasonable safeguards to PPP investors and to resolve
disputes regarding future concession agreements. There can be no denying there
is ample opportunity for private sector participation in this sector through
modernisation of stations and building rest houses on railway land, support in
running special trains for high-end and foreign tourists etc.
Railway resources need to be
increased at any cost so as to carry out various modernisation and development
plans, the most important being track renewal and constructing more lines to
facilitate easy and faster movement of trains.
Meanwhile, the CAG has asked the
Railways to revise passenger fares and curtailment of passes to recover its
operating cost in a phased manner, as per its latest report placed before
Parliament. It also urged the Railways to improve productivity, which has been
deteriorating over the years and very rightly urged the national transporter to
initiate effective measures to keep stringent check on cost escalation.
With operating costs increasing, the
Railways have not been able to recover operational cost of passengers and other
coaching services. The CAG report revealed that there was a loss of Rs
33,821.70 crores on passenger and other coaching services in 2014-15, which has
obviously increased presently.
As is well known, over 80 per cent
of the profit from freight traffic has been utilised to compensate the loss on
operations of passenger traffic. Such huge diversion of funds through cross
subsidisation cannot obviously continue for long and there is need for some
fare restructuring. However, raising fares of lower classes cannot be done
easily as the EWS and lower income groups use Railways frequently.
Apart from utilising funds
judiciously and checking projects from lying idle and incurring interest
liability, there is also a need to generate funds from other sources. These
have already been pointed out such as from utilisation of railway land, leasing
out stations to private parties and increasing all-round efficiency and
productivity.
It may be mentioned here that under
the PPP, 25 of the country’s most prominent railway stations would be auctioned
at a minimum investment of Rs 30,000 crores. Among the stations the Government
wants refurbished are Bengaluru, Pune, Visakhapatnam, Howrah, Allahabad,
Bhopal, Indore and Mumbai Central. Many of these serve as terminal points or
key junctions for both inter-city travel and suburban services.
Diverting resources to Modi’s pet
project, the bullet train, is not needed at this juncture. Even providing wi-fi
facilities can wait. The urgent priority is to concentrate on upgradation and
maintenance of tracks to increase speed of premier and super trains, whose
running is slow by global standards, and also construction of freight
corridors. Railway Minister Prabhu has stated: “In the past two years, we have
sanctioned 14,000 km of doubling of tracks and work is underway”. This would
obviously boost up trains’ speed and efforts should be made to maintain an
average speed of around 120 km per hour for express trains.
The Railways has to aspire to be
professional unlike most government organisations, where it is missing. There
is need for strictness in ensuring ticketless travel is completely banned and
no one is allowed to enter stations without platform tickets. This would help
in raising revenues and curbing the deficit in passenger tariff. In fact,
accountability has to be fixed for those at the top than in the lower
cadres.
An important issue that has hogged
the limelight is the late running of trains which should be investigated by a
team of experts and remedial steps taken thereof. Politicians and even
bureaucrats do not give attention to this aspect as they are accustomed to air
travel. It is the common man who suffers. The focus on railway modernisation
should not be aimed only for the few who travel in AC classes but for those who
travel ordinary. The concept of ‘dynamic fares’ has already raised fares in the
upper classes and it is generally agreed that further hike of fares can only be
carried out by providing better facilities.
In this connection, mention may be
made of improving sanitation in the lower classes and ensuring cleanliness and
adequate water availability, which in most trains have been abysmal. If
necessary, a small charge may be levied towards implementing ‘Swachh Bharat’ on long distance fast
and super fast trains.
One cannot deny that the challenges
faced by Indian Railways are indeed enormous and there is need for complete
transformation of the operational machinery to ensure better and more efficient
functioning. How far the Central and
zonal administration can do so, remains to be seen. It may be mentioned, that
the 2nd Administrative Reforms Commission (ARC), which was accepted by the
Government had recommended that ‘Social Audit’ would become mandatory once a
year for all organisations that have public interface to assess their
efficiency and there be a grievance redressal mechanism. Though the Railways is
possibly the biggest organisation that has public interface such audit has not
yet been started!
Apart from this, innovative reforms
such as redevelopment of stations are needed to maintain a balance with the
finances available and the possibilities of raising additional revenue as
outlined above. Unless there is extra effort and innovative action, it would
indeed be very difficult to meet the immediate requirements the Railways need
for maintenance, upkeep and modernisation in a phased manner in the coming few
years.
Recall, that even though the Railway
budget was merged with Union Budget, not much was expected. The creation of a
Railway Safety Fund with a corpus of Rs 1 crore appears meagre more so due to
the increase in accidents. An allocation of Rs 55,000 crores had been earmarked
for the Railways out of its total capital expenditure of Rs 1.31 lakh crores.
Construction of freight corridors, improving connectivity in Kashmir and in the
North East, upgrading signalling, redeveloping stations were on the agenda.
However, there was no mention of track renewal or upgradation in the Budget
speech which was important.
Nevertheless, if there is a
professional outlook from top to bottom and a strict enforcement of rules,
there can be hope that the health of the Railways could improve. With its wide
network across the country, the Railways need special care. Not by Government
alone but the users too, i.e. we the citizens. --- INFA
(Copyright, India News and Feature Alliance)
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