Railway ministry is totally different from all
other ministries of central government because other ministries get outright
grants whereas Railway earns every penny it spends.
Shortfalls and challenges
The greatest drag on present Railways is its
subsidy for passengers (about 30,000 crore rupees) which is not coming from the
general exchequer but is cross-subsidised from freight to passenger. Railway
passenger fare in India today is the cheapest in the world - one fourth of
China. Its freight is one of the highest, only because of this cross
subsidisation. As a result, poor people of the country have to bear the brunt by
facing indirect taxation as because essential commodities are transported by
railways and the common consumers have to pay for that.
India's export products become costlier and
uncompetitive in the world market because of the high freight rate. In many of
the developed European countries their government subsidise the railways towards
the losses incurred on passenger traffic. For example, the United Kingdom
released 2.3 billion pound in 2013-14 to their companies on this account. The
loss per passenger KM for Indian Railways has increased to 23 paise by the end
of March 2014. Therefore, Railway Minister has already stated that reduction in
passenger fares is unlikely in the ensuing railway budget despite sharp fall in
diesel price. On the top of that new railway line projects are often announced
during the Railway Budget annually without securing
additional funding for them. In the last 10 years, 99 New Railway Line projects
worth 60,000 crore rupees have been sanctioned, of which only one is complete
till date. In fact, there are 4 projects with Railways that are as old as 30
years but are still incomplete for one or the other reason. It is estimated
that, to complete all the pending rail-projects it requires five lakh crores of
rupees, which is a tall order.
With rapid increase in passenger and goods
traffic, frequency of train accidents is increasing. This has raised serious
concern about safety of Rail travel and the general health of the rail network.
Thus the credibility of an organisation with a long and proud history of nation
building is eroding. The Khanna Railways Safety Committee had reported that
Indian Railways have 34,000 overage wagons, 1,322 overage coaches, and 1,560
stations with overage signalling. Moreover, 262 bridges are listed “distressed.”
The white paper released by Indian Railways in
April 2003 acknowledges that over 51,000 bridges are of 19th century vintage.
Out of a total of 1,27,154 bridges in India, 56,178 are more than 80 years old.
Thus 44.17 per cent of the bridges have outlived their life.
According to the review conducted by the
Comptroller General of India on various aspects of bridge management between
1997-98 and 2011-12, these old bridges include 339 important, 4,210 major and
51,629 minor bridges built before 1920. Resource crunch is said to be the main
cause of all these weaknesses and shortfalls.
Nation’s crucial network
Railways provide the cheapest and most convenient
mode of passenger transport both for long distance and suburban traffic.
Railways have played a significant role in development and growth of industries.
Growth of textile industry in Mumbai, jute industry in areas surrounding Kolkata,
coal industry in Jharkhand etc. has been possible largely due to the development
of rail network. Railways help in supplying raw materials and other facilities
to the factory sites and finished goods to the market. Railways are particularly
suited to long distance journey and provide a strong thread of national
Railwayss play a vital role in mitigating the
sufferings of the people in the event of natural calamities like droughts,
floods, famines, earthquakes etc. by carrying relief and rescue teams and
essential items to the affected areas to save people from sufferings and
starvation. The services rendered by Railways, immediately after the Super
cyclone of 1999 in Odisha is the testimony of that.
Budget of Hopes
Railways make the backbone of the national economy
and it has bigger role to play if India has to emerge as a super-economic power.
For this the Railways require massive investments to increase its capacity and
upgrade itself to meet the newer transport challenges with speed, predictability
Funds are needed for many things: augmenting
rolling stock and improving the quality of wagons and coaches, building
new-lines, upgrading electronic signalling to ensure that tracks are not lying
idle, and strengthening track and bridges for high speed train movement. To do
all this, major reforms including structural changes are required.
In his first Budget, Railway minister Suresh
Prabhu is expected to announce a series of measures for improvement in the
financial health of the ailing national transporter. Ever since Suresh Prabhu
has taken charge of the Railway Ministry, he has made it clear that he is more
concerned with the turnaround in Indian Railways than taking the populist path.
Expectations are high from the Railway Minister amidst the latter’s firmness to
bring in fundamental changes in the commercial and operational aspects.
Rail connectivity tops the expectations chart in
every region. However, in far flung states of the Northeast region, rail
connectivity remains an issue even after 67 years of Independence. It is
expected that the region will be connected by rail, and efforts are being made
in this area at the fastest pace. As a strong message in this regard recently,
Prime Minister Narendra Modi inaugurated new rail-lines in Arunachal Pradesh.
Going by the last rail budget wherein there was a
plan holiday on new rail lines, it may not be different this time. However,
Railway Minister may rather focus on completion of the pending projects than
announcing new ones.
In its maiden Budget last year, the NDA government
hiked passenger fares by 14.2 percent and freight rates by 6.5 percent - the
steepest rise in 15 years – in a politically controversial move. The fare hike
was announced to fund new wagon purchases, to modernise tracks, revamp lines and
The government, in its Budget announcement last
year, said that it would closely monitor implementation of the Eastern and
Western Dedicated Freight Corridor Projects (DFCs). It had also set a target of
nearly 1000 km of civil construction contracts.
It must be noted that the 3,300 km long project,
which will crisscross various states, shall transform India's freight transport
facility. It is expected that the Railway Ministry will come up with a concrete
plan to fast pace the DFCs connecting Delhi to Mumbai and Ludhiana to Dankuni in
West Bengal. Similarly. It is expected that, keeping the present scenario in
view, the Minister may announce only a few new trains.
In the present scenario there is limited scope for
additional government support for Railways projects. Therefore, Railway
Minister Suresh Prabhu has spoken on the need to connect with the state
governments. For that, Minister is roping in state governments to form Special
Purpose Vehicles to fund and construct rail-projects. The Cabinet in August last
year had approved a proposal to open up Indian railways to foreign investment by
allowing 100 percent FDI in areas such as high-speed train systems, suburban
corridors and dedicated freight line projects to be implemented in PPP mode.
However, under pressure from trade unions, the
government denied of having any intention to privatise the Railways. The
government must find a midway to tackle the crisis arising out of resentment
from the trade bodies and at the same time make sure that it ably infuses funds
into the cash-strapped railways.
Adhering to Prime Minister's dream of “Swachh
Bharat,” it’s expected that Railway minister would come up with a concrete plan
for cleanliness and maintenance of the sector. The Railway ministry has not done
much towards increasing bio-toilets in sufficient numbers of trains to mitigate
the problem of direct discharge of human waste on the tracks and platforms. So,
it is believed that the government comes up with a roadmap for future course of
action to deal with issues related to hygiene, cleanliness and sanitation.
Also, a lot needs to be done over the security
issue. Every year, the government promises ample steps to ensure safety in
trains and platforms. However, the promises rarely turn into reality. The
government has to make sure that it fulfils the promise of deploying escorting
RPF teams in trains, escorted coaches for ladies, multi-pronged approach to
eliminating unmanned level crossings and building boundary walls around
stations, among others. Use of solar energy in a big way, launching of
waste-to-energy projects and proliferation of
CNG in train operations are some of the
green initiatives likely to be announced in the
Rail Budget this time.
The Odisha Case
As far as Odisha is concerned, going by the
overall trend and financial position of Indian Railways, there is rare
possibility of announcement of new rail line project in Odisha. But, at the same
time, special emphasis may be given on early completion of important on-going
railway projects in the state. Adequate fund is due this time for the long
cherished Khurda-Bolangir rail line as state government has agreed to provide
required land free of cost as well as to bear 50% of the cost of the project.
This is a first of its kind gesture from Odisha government to boost expansion of
rail network in the state.
Similarly considerable allotment is expected for
Talcher-Bimlagarh rail line as the construction work has picked up momentum.
Besides, two other new rail line projects, Angul-Sukinda and Haridashpur-Paradip
are being executed under PPP (Public Private Participation) mode and Railways
have already released their due shares for these projects through Rail Vikash
Nigam Limited. State Government has ensured acquisition of required land for
these two projects. With land and fund already available these two lines could
be completed in near future. Further Odisha government has agreed to participate
in a SPV (Special Purpose Vehicle) for expeditious expansion of rail net-work in
So, concrete budgetary provisions for completion
of the ongoing projects in the state would be in the best interest of the state
so far as expansion of rail network in Odisha is concerned.
The nation also hopes that the 2015 Railway
budget would set a turning point in the growth of Indian Railways.
[Author is the Managing
Director, Angul-Sukinda Railway Ltd.]