The Telegraph
Wednesday , July 9 , 2014
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Ever since the era of economic reforms began in India, The Telegraph has consistently argued in these columns that the one area of government that is in dire need of reforms and fresh ideas is the Indian Railways. It is also true that the railways have consistently been denied the benefits of the winds of reform. Railway ministers have come and gone and governments have changed, but the Indian Railways have stayed on its well-worn tracks as the biggest government undertaking, the budget of which is close to 10 per cent of the Central budget. No government or railway minister has raised the fundamental question: why should the government be involved in the running of the elaborate and complex railway network? Why should not the railways, in the spirit of economic reforms, be open to private capital and initiative? It is worthy of note that the railways form a separate ministry and is not under the minister of transport. The latter’s remit thus does not extend over the most important and elaborate transport network in the country. Year after year, the railway budget announces cosmetic changes — new trains, pre-cooked meals, availability of Wi-Fi and so on — and avoids addressing any of the fundamental issues.

This year’s rail budget is no different, save for the announcement that the bulk of future railway projects will be financed through public-private partnerships. This is just a glimmer of a change. The railways are a loss making venture. The finance minister, Arun Jaitley, had announced that the losses incurred by the railways on the basis of passenger fares alone was close to Rs 30,000 crore. This figure alone suggests that all is not well in the way the Indian Railways are run: not to put too fine a point on it, there is a big question mark on the financial sustainability of the Indian Railways. Increasing passenger fares — already announced before the budget — is one way of reducing losses. But time has run out for such tinkering and for a separate rail budget and for separate editorials on the rail budget. The railway budget should be scrapped and be made part of the finance minister’s budget for the country. The prime minister has promised India an era of radical change and reform. He could have easily begun with the railways. Instead, the railway minister, D.V. Sadananda Gowda, has presented a budget directed not towards change but towards consolidation. There is no major gesture towards populism: praise be for small mercies.