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Railway Budget: No hike in passenger fares, freight rates

Last updated on: February 12, 2014 19:25 IST

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Passenger fares and freight rates were left untouched on Wednesday in the interim rail budget, which talks about plans about involvement of private sector and FDI as part of efforts to modernise the largest transport network in the country.

Presenting the interim budget for four months in the Lok Sabha, Railway Minister Mallikarjun Kharge said an independent Rail Tariff Authority is being set up to rationalise fares and there was a proposal to expand dynamic pricing of tickets in line with the airline industry.

He announced the launch of 17 new premium trains, 39 express trains and ten passenger trains in the coming year and providing rail connectivity to Katra and Vaishnodevi in Jammu and Kashmir, and Meghalaya and Arunachal Pradesh in the Northeast.

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Interim Railway Budget 2014-15: Complete Coverage


Photographs: Reuters

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Kharge's budget speech was cut short because of continued slogan-shouting and unruly behaviour by MPs from Andhra Pradesh, with even four Ministers trooping into the Well over the Telangana issue.

The Minister also announced starting of more high-speed trains and said the Ministry was exploring low-cost option of semi high-speed trains on select routes moving at 160-200 km per hour.

The budget speech did not touch upon passenger fares or freight rates. Kharge later said no hike has been proposed.

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Interim Railway Budget 2014-15: Complete Coverage


Image: Railway Minister Mallikarjun Kharge
Photographs: Reuters

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Annual Rail Plan has been pegged at Rs 64,305 crore with a budgetary support of Rs 30,223 crore (Rs 302.23 billion).

Referring to the premium AC special train introduced on Delhi-Mumbai sector with shorter advance reservation period, Kharge said, "The fare charged includes a dynamically varying premium over Tatkal fare of Rajdhani services."

"Such dynamic pricing was widely appreciated by the users... we are considering operation of this scheme on a larger scale," he said.

On the government's intent to mobilise resources for the cash-strapped transporter, he said investment in Railways was being stepped up through partnership with the private sector.

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Interim Railway Budget 2014-15: Complete Coverage


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"Apart from attracting private investment from domestic investors in rail sector, a proposal is under consideration of the government to enable FDI to foster creation of world-class rail infrastructure," he said.

Kharge said projects in pipeline involving private partners through public-private partnership (PPP) route related to rolling stock manufacturing units, modernisation of railway stations, multi-functional complexes, logistics parks, private freight terminals, freight train operations, liberalised wagon investment schemes and Dedicated Freight Corridors.

The Rail Land Development Authority, set up with a "challenging target" of Rs 1,000 crore (Rs 10 billion), had already raised Rs 937 crore (Rs 9.37 billion), he said.

Interim Railway Budget 2014-15: Complete Coverage


Photographs: Reuters

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Announcing that the governments of Karnataka, Jharkhand, Andhra Pradesh and Haryana had agreed to share cost of several rail projects, Kharge appealed to other state governments to follow suit to create rail infrastructure in their respectiveareas.

A joint feasibility study for Mumbai-Ahmedabad high-speed corridor, co-financed by the Railways and Japan International Cooperation Agency, which started in December last year, would be completed in 18 months, he said.

For the same corridor, a business development study undertaken by French Railways would be completed by April this year, the Minister said.

Besides, the department also intended to explore low cost options for raising speeds to 160-200 km per hour on existing select routes like Delhi-Agra and Delhi-Chandigarh. 

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Interim Railway Budget 2014-15: Complete Coverage


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The Railway Minister later tabled the interim budget in the Rajya Sabha amid slogan-shouting and unruly scenes over Telangana and other issues.

Maintaining that Rail Tariff Authority was being set up to advise the government on fixing of fares and freight charges, Kharge said, "Determination of rates will no longer be an exercise behind veils where the Railways and the users could only peep covertly at what was happening on the other side."

He said the authority would not only consider requirements of the railways but also engage with all stake-holders to usher in a new pricing regime through a "transparent process".

The Minister also spelt out a series of steps including SMS alerts, ticketing on mobile phones in the unreserved segment and online booking of meals in trains. "IT has revolutionised our customer interface over the last few years. We intend to continue the process," he said.

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On the financial performance of Railways, he said the department had met from own resources total additional impact of Rs one lakh crore because of 6th Pay Commission.

"We are confident of surpassing the freight earnings target which has been increased to Rs 94,000 crore from Rs 93,554 crore in budget estimates. Considering the trend of passenger earnings, the revised target has been kept at Rs 37,500 crore," Kharge said.

Considering the trend of earnings and expenditure, the revised plan outlay stands at Rs 59,359 crore. The operating ratio was likely to be 90.8 per cent as against the budgeted target of 87.8 per cent.

"In a marked improvement from the two earlier years, Railways will end the current year with surplus, and fund balance would increase from Rs 2,391 crore at the beginning of the current fiscal to Rs 8,018 crore at the end of March 2014," he said.  

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On the safety aspects, the Minister said several measures are being taken to further strengthen it.

These include manning or elimination of unmanned crossings, induction of indigenously-developed train collision avoidance system and provision of Vigilance Control Device to monitor and judge alertness of drivers.

Referring to recent incidents of fire on trains, Kharge said a comprehensive fire and smoke detection system is on trial on Rajdhani Express and based on its success, these would be extended to all major passenger trains.

Other measures include use of fire retardant material inside coaches, multi-tier protection for electric circuits, provision of portable fire extinguishers in AC coaches and introduction of electrical induction based cooking appliances to replace LPG in pantries.

With regard to new trains and extension of tracks, he said train services are expected to start very shortly to Katra, the foothills of famous Vaishno Devi shrine in Jammu, enabling pilgrims for all over the country to reach there directly.

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The proposals also talk about focus on extension of rail connectivity in Northeast. This includes bringing Arunachal Pradesh on the rail map in this financial year, with the commissioning of a new line shortly to Harmuti-Naharlagun which is close to its capital Itanagar.

Meghalaya is also set to come on the rail map this financial year as Dudhnoi-Mehendipathar would be completed by next month, the Minister said.

On 'green initiatives' taken by the Railways, he said the Railway Energy Management Company was working on setting up windmill plants and solar power plants and 200 railway stations, roof-tops of 26 buildings and 2,000 level crossings would be initially covered.

He also said creation of 'green curtains' at Agra and Jaipur stations was being undertaken on a pilot basis and once it succeeds, corporate entities would be invited to participate in this programme.

Kharge also said the coverage of the bio-toilet project, already introduced in about 2,500 coaches, would be expanded progressively. 

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