February 16, 2014

Interim Rail Budget: Most Disappointing

THE interim railway budget presented by the railway minister has disappointed the people of our country. This was the opinion the Centre of Indian Trade Unions (CITU) expressed through a statement issued from New Delhi on February 12. The CITU pointed out that because of the budget all the works like extension of network, modernisation of the system, filling up of vacant posts, replacement and rehabilitation of old and worn-out plants, machineries and rolling stock, track renewal, etc, have suffered in the recent past. The operating ratio, increased to 94 percent by successive railway ministers, has failed to bring back the railways even to the earlier position. The policy of economic ‘reforms,’ which the government is pursuing vigorously, was also reflected in the interim budget. An independent tariff regulatory authority is being created which will determine freight and fare. The main purpose is to minimise, rather phase out, the cross subsidy being provided since the inception of the railways. Thus the burden on common man will be increased. About 80 percent of the passengers who travel in second class sleeper are the poor and the middle class. If the cross subsidy is phased out, the burden on these sections will increase enormously. Creation of a freight regulatory authority was announced in rail budget 2012-13 when Dinesh Trivedi was the minister. Now the freight rate is to be linked with the price of fuel. Last year the freight rate on different commodities was increased a number of times, which has had its impact on inflation. The main thrust has been on public private partnership (PPP) in rolling stock manufacturing units, modernisation of stations, freight terminal, freight train operation and dedicated freight corridors. The railways are now to depend on private investments. But PPP has not been successful in railways, as in other areas. In addition to PPP, now the government has allowed FDI in railways and that too in the high speed corridor. Foreign investors will not simply invest but undertake construction and operation of trains in this corridor. This has to be restricted. The CITU said there are a large number of vacancies in railway, estimated to be 2.5 lakhs. But there is acute shortage of safety related staff on the other hand. As a result, maintenance of coaches and locomotives are not done properly. The increase in investment for the year 2014-15 is about one thousand crore and, if we adjust it for inflation, there is hardly any increase over 2013-14. And that is why no new projects --- new lines, gauge conversion, doubling etc --- have been announced in the budget. Thus there won’t be any expansion of rail network. The minister has perhaps left it to the new government. But he has failed to show which way the Indian Railways will go in future. The Indian Railways is not just a commercial organisation; it has also a social outlook. But, by allowing PPP in a number of activities and by allowing FDI and FII for the first time in railways, the Indian Railways is going to be converted into a completely commercial organisation. The CITU has denounced such a retrograde approach that is most unfortunate for the common people of our country.