STRENGTHENING INDIAN RAILWAY’S CONTRIBUTION TO THE ECONOMY |
Initiatives and Achievements of Indian Railways
(IR)
1. Indian Railways be complimented for National Railway
Plan (2030) which addresses Network congestion by
rapid capacity augmentation of 5,571
Km of very high density network. Prioritization has been done by classifying criticality of projects with a total outlay of Rs 7.5 lakh Cr.
2. Vision 2024 focuses on Port
connectivity, coal evacuation, J&K projects and North East connectivity for completion by 2024.
3. Delhi- Mumbai and Ludhiana–
Delhi– Sonnagar Dedicated Freight Corridor
(DFC) projects (Total 2800 km), to run long haul goods trains at a speed of 100 kmph potential which is
planned for completion by 2023.
Construction activities in the high speed Mumbai-Ahmadabad project, held up earlier by land
acquisition problems have gathered momentum.
4. Achievement of IR has been on
safety with no serious passenger Train
Accidents during period 2019-20
- 2020-21 by expediting
replacement of over aged assets / track renewals, elimination
of unmanned level crossings and replacement of old coaches by new safer Linke Hofmann
Busch (LHB) coaches.
CONCERNS AND RECOMMENDATIONS
5. These include recent trends of high operating ratios, low generation of internal net surplus revenues leading to low funding for safety, capital and rehabilitation works. The Parliamentary Standing Committee (2019-20) on Railways also made observations on above concerns.
6. Losses in Passenger Operations. These have
mounted to over Rs 50,000 Crs
annually. IR needs to address this issue urgently by a progressive increase in fares and seek State & Central
Govt support for taking
over suburban losses. High Staff costs (60% of working expenses) will need to be reduced by freezing some
percentage of vacant posts, progressively.
7. Uncertainties in Future Coal Freight Earnings. Presently these contribute to around 48% of total freight earnings. Demand will come down in future because of carbon emission/climate change issues. Economic Survey (2019-20) has stressed need for IR increasing its share of freight traffic from around 27% to 45% by 2030 in rail/road freight mix from energy conservation/ carbon emission angle. This will be challenging.
8. Financial Performance. 2019-20 ended with Gross Traffic Receipts Rs.1,89,906.58
Cr and Total Working Expenses Rs 1,84,780.30 Cr. The Net Revenue Receipt was only Rs 3,773.86. The Average rate paise/passenger Km was 20.7 in Suburban
& 52.4 in Non Suburban.
9. Standing Committee on Railways has
revealed a consistent fall in revenues,
rising expenditure coupled with erosion of customer base in freight and passenger traffic. There has
been increasing dependency on Extra
Budgetary Support. Prudence demands of not over reliance on market borrowings. Committee suggested that a part of
pensionary payments burden
be taken over by Ministry
of Finance.
Passenger and Suburban Losses
10. IR is incurring losses over Rs
50,000 Crs annually on passenger/ suburban operations. Survey shows that economic
categories can absorb
price rises.
11. Suburban Segment. Mumbai Rail Vikas Corporation (MRVC) report states that Mumbai locals have cheapest public transport at 50 paise per km vis Metro at Rs 5 for a km, and BEST at Rs 4/km. There is Considerable scope to increase Suburban fare.\
12. Long Distance
Passenger Segment. Buses are popular for distances
around 250 kms. However, Rail scores over with sleeper facilities and need to adopt dynamic pricing for reserved accommodation for trains like Rajdhani– Delhi- Mumbai.
Other Rajdhani’s and new fast trains,
semi high speed Vande Bharat and special trains run more than 30 per day. There is a need for running
some trains with chair cars, especially with upgradation of trunk routes
up to 160 kmph. Coaches
be fitted with seats with airline type ambience, better designed toilets and heating ovens for food. Platform &
travel tickets should include insurance
for accidental injuries and ticketless drives must be intensified.
13. Dedicated Freight Corridors. With
diversion of Goods trains to DFC from
trunk routes, released capacity should be judiciously utilized for new high revenue segments
e.g. running of high speed, time tabled,
high value parcel trains. To enable pickup and delivery to doorstep, IR should collaborate with cargo couriers/
operators to help in last mile delivery.
14. Special Measures to attract additional Freight to enable IR to reach a share of 45% in Rail / Road Freight Mix. Railways involved
in movement of raw materials
for steel and large cement
plants must focus
on greater share of finished steel products and cement and deliver them to specified stockyards or cluster
of their warehouses in the region
by cooperation with Road Operators. Road transport scores over IR in delivery time. Therefore IR should cut
terminal delays and enroute detentions.
While Kisan specials have been planned, Milk traffic needs focus with development of refrigerated
wagons. IR must effectively integrate into PM Gati Shakti program.
15. Terminal Development. Focus on terminal development especially on PPP mode can help improve efficiency, reduce terminal detention with mechanised handling, providing good road access and locating warehouses near loading points. Railways will have to ensure timely delivery of wagons and withdrawing after loading.
16. Need for
Compulsory Shift of Medium Distance Heavy Road
Freight Traffic to Railways through Policy Initiatives to progress PM’s commitment of Zero Emission India by 2070. Railways consume only 1/6th
energy required by road transport. With 100% electrification of IR and progressive increase of
Renewable Energy in the National Grid
reaching 50% of total mix by 2030, there will be further reduction in carbon emission if freight traffic from
road is shifted to Railways. Govt. will have to hasten
the issue of shifting of heavy Road freight to Rail as this cannot
be left to market forces.
While electric mobility
is being encouraged with incentives, bulk of the movement on Highways will still be on fossil
fuels for a long time.
18. Planning future
Dedicated Freight Corridors Alignment Based on Energy Saving Criteria. In
case of Delhi–Howrah, Delhi–Mumbai DFCs,
where alignment has been planned adjacent to existing trunk routes, planning for future DFCs be
attempted on shortest feasible alignment.
NHAI has shortened its Mumbai-Delhi route alignment on this pattern to ensure
considerable energy saving. Future DFCs should be planned for 32.5 ton axle load wagon running. New DFC alignment should be connected whenever interchange is required to PM Gati Shakti intermodal
points. DFC may also provide adequate land in the central verge to plan rapid transit rail systems
to cater for Metropolitan/Tier1 cities to reduce overall
land costs.
19. Monetization of Assets. There is huge potential of monetizing land at Stations and Railway Colonies in metropolitan cities. Due to complexities involved, there is hardly any visible outcome in policies.
20. Corporatization
of Railway Production units – Privatization of
Railway PSU’s – Retention of Majority Control in RailTel. Govt needs to hasten
Corporatization of Railway
Production units to enable them to
reach their full potential to serve the needs of economy beyond Railways
e.g. Defence sector.
21. RailTel PSU. With
monopoly in Optic Fibre Cable laying (OFC) IR
has completed over 60,000Kms which is nearly entire IR system. It is also providing support to Railways (24X7)
in traffic operational systems including
signaling safety between
stations, Anti train
collision protection systems (Kavach), traffic control
management, radio communication to stations
besides add on services. Rail Tel is also involved in providing communication support to many Govt/ PSU
units, and organizations involved in National security. For Govt control, disinvestment of RailTel be restricted to 49%.
22. Austerity measures in Revenue Expenditure and Careful Project Selection/Reducing Project costs. Railways
need to prune down Revenue
expenditure and Project costs. It must explore low cost options like improved signaling by introduction of more
Centralized Traffic Control
(CTC), Automatic Block Signaling (ABS) prior to planning for additional routes involving land acquisition.
23. Financial Interventions for Consideration. When unremunerative projects
are undertaken with External Benchmark Rate (EBR), prior approval of Ministry of Finanace (MoF) be taken. Market
borrowing be restricted to 10% to 15% of capital outlay
till internal revenue
generation situation
improves. A new model be instituted by MoF to demarcate commercial and social responsibilities of Railways and support
funding by Ministry of Railways
and Ministry of Finance.
24. Pricing. There is distorted pricing due to non-revision of fares for Passenger segment. Further, there is loss in suburban traffic with more projects in the pipeline. It is suggested that like the Highways, an act/ rule be contemplated with annual revision of fares linking these to indices like WPI etc. Taking a leaf from the ‘Bad Bank’ set up by the MoF for bad
debts suburban trains system be hived off into an
independent entity from financial
angle by creation of a special
financial structure supported by contributions from Central, State Govts & IR to share losses.
Operations to continue
with IR.
25. Need For a Full Fledged Railway Regulator. Considering
that the PPP model is increasing, there will be need for a full fledged Railway
Regulatory mechanism to sort out issues between private operators and IR. With shift of Heavy Freight Road Traffic to Railways, it is desirable for one common
regulator for the entire transport
sector in future.
26. Building Human Capital in Railways. Keeping in view technological upgradations, it is important
Railways pay adequate
attention to quality of staff recruited at lower levels. Depending on
the competence required, standards similar
to Army Recruitment system be implemented. Railways bonus system be
restructured for different categories of staff which
will lead to overall higher
productivity.
27. While restructuring the Railway
Board on non departmental lines is
welcome, ignoring needs of technical/ professional specialization at lower levels may affect professional
performance of the organization. Technical departments be retained below the Apex level of
the Railway Board. The Indian
Railway Medical Service (IRMS) cadre can be created from Divisional Railway Manager (DRM) and
above level consisting of all the general posts like AGM, SDGM/CVO, CPO, CPRO, GM etc.
Suggested Focus for IR for 2030
28. Indian
Railways should strive to become low cost, efficient, safe, profitable and zero emission transporter of Passengers
& Goods. By integration into PM
Gati Shakti program, IR should become the backbone of National multimodal transport network.
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