The Telegraph
Since 1st March, 1999
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There is no dearth of recommendations on what needs to be done with Indian Railways. In the recent past, an expert group submitted its report in 2001 and there was a railway safety committee in 1999. Within the railway ministry, there have been status reports. The core recommendations are the following. Rationalize fares to prevent cross-subsidization of passenger traffic through freight. Reduce 20 per cent of excess employees. Corporatize Indian Railways, revamp the railway board. On safety, make all inquiries transparent and public. There are more, but these will suffice. A test of the railways budget for 2003-04 is the extent to which these reform initiatives are pushed.

Before dubbing Mr Nitish Kumar a failure, it should be recognized that some of his predecessors have done worse. This is an election year budget and consequently, reform is out. Senior citizens may turn against the National Democratic Alliance. So wean them by reducing the age limit to 60 years. Cancer, thalassemia, heart and kidney patients also vote and need concessions. Journalists, especially those who travel on Rajdhani and Shatabdi, not only vote, they also write against the railways ministry. They too must be cultivated. On passenger fares, the only sensible suggestion is that of seasonal concessional non-peak rates and hopefully, this will eventually generalize into more flexibility in fare determination.

With a pension burden of Rs 6,000 crore, growing at 21 per cent a year, and 1 million pensioners, one would have expected some movement on pension reform and downsizing through voluntary retirement scheme. Instead, 3,500 new constables will be recruited into the railway protection force, perhaps recruited from Bihar. Barring anti-collision devices, 5,400 kilometres of track renewal, 775 km of gauge conversion and 375 km of electrification, there are no signs of the 1999 safety committees’s recommendations being implemented. Instead, there will be 50 new trains, mega terminals in Delhi and Calcutta, a Jammu-Udhampur rail link and 225 km of new lines. The total expenditure is Rs 12,918 crore, inclusive of Rs 2,311 crore for safety. Since budgetary support is only Rs 6,577 crore, Rs 2,630 crore will come from internal resource generation (doubtful), Rs 2,970 crore through market borrowings by Indian Railways Finance Corporation and Rs 30 crore through a build, operate, transfer project. This does not solve the financial problem, or implement the idea that new investment has to be financed on a commercial basis. Barring BOT, the only sensible financial idea is the task force that will suggest ways of private sector participation in cleaning up the railways. Perhaps similar private sector participation can be suggested for cleaning up the railway budget. But in all fairness to Mr Nitish Kumar, while he may not have moved forward on solving the fiscal mess, he has not made it worse. With an eye on the NDA’s electoral stock, the matter of the rolling stock can wait.

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