Continuing the trend of the past few years, the Railway Budget for 2007-08 may leave the second class train fare unchanged, but upper class AC and freight fares may be 'rationalised,' a euphemism for an upward revision.

In his fourth consecutive Rail Budget to be presented on February 26, Railway Minister Lalu Prasad may announce the introduction of dozens of air-conditioned Garib Raths and a major role for private players in the modernisation and development of infrastructure for the railways.

"Nobody can think of increasing fares when a huge turnaround is once again in the offing," a source in Rail Bhavan said.

Sources were of the view that Prasad may continue to follow his 'mantra' of not increasing fares but raising 'volumes and capacity.'

He may rationalise AC fares particularly in the wake of the turnaround and falling petrol prices globally, they said and recalled the reduction in AC first and AC second class fares in the budget for 2006-07.

With regard to the introduction of more Garib Raths, the minister himself has indicated on several occasions that if the four Raths announced in the budget 2006-07 are successful, more such trains linking state capitals would be introduced.

While two Garib Raths, one between Saharsa in Bihar and Amritsar in Punjab and another between Patna and Delhi, were in operation, another two between Delhi and Mumbai and Delhi and Chennai are to be launched before March 31.

Speaking at an infrastructure conference here, Prasad had said a comprehensive scheme involving the investment of Rs 300,000 crore (Rs Rs 3,000 billion) in the next five years was being planned, and 40 per cent of the funds are expected to come from public-private partnerships.

He also announced the setting up of a public-private partnership cell in the railway ministry to woo investments to develop and modernise rail transport.

"In order to attract private investment through PPP, there is a need for a policy which ensures adequate profits to investors. We have decided to set up a PPP cell headed by the chairman of the Railway Board to attract private participation," he said.

The cell will prepare policy for projects. Private players are expected to be involved in running container trains, constructing dedicated freight corridors, modernising railway stations and establishing logistic parks and warehouses, he said.

Referring to the Rs 30,000-crore (Rs 300 billion) eastern and western dedicated freight corridors linking Delhi to Mumbai and Kolkata, Prasad said his ministry favoured PPP to build multi-model logistics of the corridors while the running of trains remained with the railways.

With 2006 being observed as the year for passenger amenities, Prasad is set to announce more facilities to railway commuters.

The railways is devising a major strategy to win over the masses by significantly improving amenities, including at stations, and has asked all zonal railways to 'identify and hire' consultants and architects to refurbish stations.

The railways is also actively considering a proposal to re-design air-conditioned three-tier coaches for general trains and increase their capacity.

The ministry plans to make changes in the design and increase the capacity of such coaches from 64 to 81, and the effort will bring additional revenue to the railways and help in cutting short long waiting lists, sources said.

On the infrastructure side, Prasad has announced focussed attention on modernising and upgrading wagon technology, installing advanced signalling and telecommunications, inducting high horsepower locomotives and using information technology especially tailored to improve transit time and lower unit cost operations.

The railway ministry's financial strategy will be to leverage budgetary and internally generated resources and funnel them to service its huge Rs 3.5 lakh crore (Rs 3.5 trillion) investment plan for the 11th Five Year Plan beginning this year.

• Run-up to Budget 2007: Coverage