No hike in fares, Railways to attract FDI

Union Railways Minister D.V.Sadananda Gowda at Rail Bhavan before leaving for Parliament to present the Rail Budget 2014-15. PTI
Union Railways Minister DV Sadananda Gowda at Rail Bhavan before leaving for Parliament to present the Rail Budget 2014-15. Photo: PTI

New Delhi, Jul 8 (PTI): Sparing passengers of any further fare hike, Railway Budget for 2014-15 proposes to attract private domestic and FDI in infrastructure projects and pursuing private-public partnership to boost the finances of the cash-strapped railways.

Having hiked fares to the tune of 14.2 per cent recently, Railway Minister Sadananda Gowda who presented the new government’s first budget in Lok Sabha said he plans to leverage railway PSU resources by bringing in their investible funds in infrastructure projects.

He announced plans to introduce a bullet train in Mumbai- Ahmedabad sector and setting up of a Diamond Quadrilateral network of high speed rail connecting major metros and growth centres. A sum of Rs 100 crore has been provided for initiating the project.

Increasing the speed of trains to 160 to 200 kms per hour on nine select sectors was another highlight of the budget, which proposes to allow all experimental stoppages to lapse after September this year.

The Budget disclosed that traffic growth declined and expenditures went up in 2013-14 as compared to the revised estimates of previous financial year.

Gross traffic receipts stood at Rs 1,39,558 crore, short of revised estimates by Rs 942 crore over the previous year.

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The ordinary working expenses and pension outgo were also higher.

The budget estimates for 2014-15 assumes a freight loading 1101 metric tonnes, 51 metric tonnes more than the previous year, growth in passenger traffic at 2 per cent and freight earnings at Rs 1,05,770 crore.

Passenger earnings will be Rs 44,645 crore after a revenue sacrifice of Rs 610 crore on account of monthly season ticket fares.

Total receipts for the current year have been pegged at Rs 1,64,374 crore and expenditure at Rs 1,49,176 crore.

Disclosing that he needs more than Rs 9 lakh crore to completing the Golden Quadrilateral Network and Rs 60,000 crore for introducing one bullet train alone, Gowda told the House, “Can I depend only on hiking fare and freight rates and burden the public to realise these funds? This is unrealistic. I need to explore the alternate means of resource mobilisation.”

He proposed to launch a scheme to bring in investible surplus funds of railway PSUs in infrastructure projects which can generate attractive returns.

Proposing private investment in railways through domestic and FDI, Gowda said growth depends heavily on availability of funds for investment in rail infrastructure.

Internal revenue sources and government funding are insufficient to meet the requirement, the Railway Minister said, adding the ministry is seeking Cabinet approval for allowing FDI in rail sector.

FDI, however, will be limited to infrastructure development and not allowed in operations, he said.

He said the concept of PPP has not been successful in raising substantial resources for railways. “It is my endeavour to pursue this in right earnest. It is our target that bulk of our future projects will be financed through PPP mode, including the high-speed rail, which requires huge investments.”

Apart from mobilising resources, Gowda said he needed to strategically manage other aspects of planning and administration by adopting a near-holiday approach, setting timelines for ongoing projects, strategic partnership and aggressive indigenisation of imported projects.


The annual plan for 2014-15 has been fixed at the highest ever outlay of Rs 65,445 crore with gross budgetary support at Rs 30,100 crore, Railway Safety Fund Rs 2,200 crore, internal resources Rs 15,350 crore, external market borrowing Rs 11,790 crore and EBR-PPP Rs 6,005 crore.

The budget provides higher funds for ongoing projects in North East, including 11 national projects. Rs 5,116 crore earmarked for projects in North East, which is 54 per cent higher than the previous year.

While Udhampur-Katra rail link in Jammu and Kashmir has been dedicated to the nation, the focus will now be on completion of the missing link between Banihal and Katra.

18 new line surveys have been announced, which include rail connectivity to ‘char dham’ — Kedarnath, Badrinath, etc, and Shimoga-Sringeri-Mangalore.

Five Jansadharan trains are being introduced along with five premium trains, six AC express trains and 27 express trains and eight passenger trains.

The premium trains are between Mumbai Central and New Delhi, Shalimar-Chennai, Secundarabad-Hazrat Nizamuddin, Jaipur-Madurai and Kamakhya-Bangalore.

In order to strengthen security in trains and stations, the budget proposes to recruit 4000 women RPF constables.

Already 17000 RPF constables have been recruited and shall be available for deployment shortly.

Gowda said safety of passengers is of paramount importance and it is estimated that over Rs 40,000 crore would be needed to be invested in track renewals, elimination of unmanned railway crossings and road overbridges and underbridges.

A provision of Rs 1,785 crore has been earmarked for railway overbridges and underbridges.

Outlining IT initiatives, the minister said the railway reservation system is being revamped to move into next generation E-ticketing system, which will support 7200 tickets per minutes to allow 1,20,000 simultaneous users.

Railways will move to paperless offices in five years, provide wi-fi services in A-1 and A category stations and in select trains, real-time tracking of trains and rolling stock, mobile-based wakeup call system for passengers and mobile- based destination arrival alert.

The railways will also focus on providing cleanliness and better facilities at the stations and in trains. To ensure cleanliness alone, the government proposed to raise the budget allocation by 40 per cent for this fiscal.

A corpus fund would be created for upkeep of stations and extend use of CCTVs at stations to monitor cleanliness activities.

A separate housekeeping wing will be set up for maintaining cleanliness and sanitation at stations, while onboard housekeeping services will be extended to all important trains.

NGOs and charitable institutions and corporate houses will be encouraged for maintaining stations.

To provide better amenities to passengers, railways will introduce ready-to-eat meals of reputed brands in a phased manner, set up food courts in major stations besides launching a feedback service to ascertain the quality of food.

Railways will also introduce RO (reverse osmosis) drinking water units at stations and in trains on experimental basis.

That apart, it will construct foot-over bridges, escalators and lifts at all major stations including through PPP route, provide sufficient water supply and toilets, introduce battery-operated cars for senior citizens and differently abled persons at all platforms of major stations.

It will also provide workstations in select trains on payment basis, introduce parking-cum platform combo tickets and e-booking of railway retiring rooms.

It will also increase mechanised laundries for quality bedrolls in AC coaches.

Giving top priority to safety and security, the government proposed to follow multi-pronged approach to eliminate unmanned level crossings, use advanced technology to detect rail and weld fractures and to do a pilot trail on Ultrasonic Broken Rail Detection System (UBRD) at two locations.

It will set up Simulation Center to study causes of accidents and ensure safety standards match international practices. It will also start a pilot project on automatic door closing in mainline and suburban coaches and explore building boundary walls around stations through PPP mode

On green initiatives, the government said it will use bio-diesel up to 5 per cent of total diesel fuel consumption and increase the number of bio-toilets in trains to mitigate the problem of direct discharge of human waste on the tracks and platforms.

Railways will also harness solar energy by utilising roof top spaces of stations, railways buildings and land including through PPP mode.



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