The Telegraph
Since 1st March, 1999
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Govt toys with populist railway budget

New Delhi, Feb. 16: The BJP government has decided to come out with a populist rail budget, opting for a token hike in upper-class rail fares of 5 to 10 per cent while forgoing any substantive increase in lower-class and suburban fares.

It also does not wish to touch freight rates for essentials like steel and coal, which could send the rate of inflation shooting up and divert traffic to truckers who have been eating into the railway’s profits over the years.

Platform ticket prices may, however, go up to Rs 5 in metropolitan railway stations to thin down crowds of relatives who throng railway stations.

The freight rates of some of the other commodities carried by the railway will, however, be increased to cover inflation.

The move for a populist budget comes despite a decision taken by finance minister Jaswant Singh and Planning Commission deputy chairman K.C. Pant to limit the railway’s budgetary funding to just Rs 6,700 crore. This will leave the railway with the task of finding resources to cover another Rs 5,800 crore in its total development plan of Rs 12,500 crore.

Railway minister Nitish Kumar is expected to meet the Prime Minister next week to protest this huge shortfall and demand more funds as the railways is taking up sensitive projects in the Northeast and Jammu and Kashmir, which are otherwise not at all remunerative.

The railway minister has decided to go in for the populist budget in deference to advice tendered to him by NDA leaders, who have said the rail budget could make or mar their prospects in the coming state and general elections.

Kumar, consequently, feels that he is being let down by the exchequer and given a raw deal in terms of funding. This feeling was shared by his predecessor at Rail Bhavan, Mamata Banerjee.

A peeved Kumar has already decided that he will insist that joint ventures be set up with states chipping in with funds whenever any political party demands that new railway lines be set up in any state other than the Northeast. This could place even alliance partners like the BJP and the Bahujan Samaj Party at a disadvantage as not all states are willing to put up funds for the projects they are demanding.

These joint ventures will be modelled on the pattern of an existing joint venture pact the railway has entered into with Karnataka.

Most of the plan budget drawn up by the railway will go into gauge conversion and renewal of trunk tracks connecting metropolises like Delhi and Calcutta which have turned rusty with age.

Kumar has also decided that most of the new trains that he launches will be extensions of existing trunk route expresses. Although giving in to political pressures, he has also decided in favour of running more Jan Shatabdi expresses, which would mainly run to states like Uttar Pradesh, Bihar, Madhya Pradesh, Andhra Pradesh and Tamil Nadu.

However, he has been advised by the railway board against starting too many new Rajdhanis as the trunk routes have become saturated and new trains without substantive track renewal may result in more accidents.

Kumar will also carry out his pet project of operationalising from April 1 the controversial new zones created by him last year. The two zones that were supposed to have been operationalised last October — Hajipur and Jaipur — have yet to turn truly functional.

The railway minister will also go slow on privatising its functions, despite intense pressure from the finance ministry. However, this will not stop the railway from outsourcing some of the work — like cleaning a train, manufacturing spares that used to be made at the locomotive works in Chittaranjan and the coach factory at Kapurthala. The railway says it is forced to do this as a staff recruitment freeze has been imposed on it.

The railway will also go in for an extensive drive to earn more revenue from freight carriage as this could help them bridge the deficit in the funding. The budget will try to boost container traffic and non-stop freight trains, including those which run as shadows to major expresses.

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