1. Irise to present the Budget Estimates for 2003-2004 for the Indian Railways.

2. Atthe outset, I express my profound gratitude to Hon’ble Prime Minister for launching the National Rail VikasYojana, which involves the strengthening of the Golden Quadrilateral, augmenting rail connectivity to portsand also the construction of four mega bridges. This non-budgetary initiative is bound to accelerate thegrowth of the Indian Railways, which is the lifeline of the Nation.

3. Iwill now give a brief review of the performance of the year 2001-2002. The year 2001-2002 ended with a freightloading of 492.5 million tonnes which was 3.50 million tonnes higher than the target of 489 million tonnesfixed in the Revised Estimates for the year. Freight earnings have consequently surpassed the revised targetby Rs.235.40 cr. This improvement was attributable to better performance during the last quarter of the yearas the economy started picking up. Passenger earnings, however, suffered a set back in the last quarter of theyear due to various extraneous factors resulting in a shortfall in passenger earnings to the extent of Rs.204cr. against the enhanced revised target of Rs.11400 cr. Taking into account the increase in Other Coaching andSundry earnings and a lesser accretion to the Traffic Suspense as compared to the Revised estimate targets,the Gross Traffic Receipts for the year were Rs.118 cr higher than that envisaged in the Revised Estimates.
4. Asa result of continued monitoring and control over expenditure, Railways were able to contain the OrdinaryWorking Expenses to Rs.28703 cr. resulting in a saving of Rs.397 cr as compared to the revised estimates.This, coupled with need-based appropriation to DRF and Pension Fund and also the variation in NetMiscellaneous receipts, resulted in an increase of Rs.197 cr. in Railways’ net revenue. The operating ratiofor the year improved to 96.0 percent as against 96.6 percent envisaged in the Revised Estimates. Afterdeferment of Rs.1000 cr., as was envisaged in the Budget, Railways were able to discharge the balance dividendliability of Rs.1337 cr, besides repaying the loan of Rs. 249 cr taken from the General Exchequer for CapitalFund.

5. Inthe Budget for 2002-03, the originating revenue earning freight traffic has been estimated at 510 milliontonnes. I am happy to inform the House that the performance during the first 10 months of the current fiscalhas exceeded the proportionate target. Accordingly, the target for the originating revenue earning freighttraffic has been revised upwards to 515 million tonnes in the Revised Estimates for the year. On the otherhand, in the Passenger segment there has been a drop of nearly three percent in number of passengers to endDecember 2002.
6. Thegoods earnings are likely to exceed the budget target of Rs. 26,118 cr by Rs. 540 cr., whereas passengerearnings are likely to fall short of the budget target of Rs. 13450 cr by Rs. 720 cr. Taken together, theother coaching and sundry earnings are likely to be Rs. 24 cr below the budget target. Due to continuedincrease in the amount owed to Railways by the users, particularly, Electricity Boards, the unrealizedearnings are likely to increase by Rs. 417 crores as against a budgeted clearance of Rs.50 crores. Therefore,the budgeted Gross Traffic Receipts of Rs.41,538 cr have been reduced to Rs. 40,867 cr in the RevisedEstimates.
7. Withsustained monitoring and continued austerity, there is likely to be a reduction of Rs. 850 cr in the OrdinaryWorking Expenses. Accordingly, the Revised Estimates for these are placed at Rs.30,310 cr as against Rs.31,160 in the Budget Estimates.
8. Theoperating ratio budgeted at 94.4 percent is likely to improve to 92.5 percent in the Revised Estimates.
9. Besidesdischarging fully the dividend liability for the year, an amount of Rs. 50 cr is also proposed to be clearedfrom the Deferred Dividend Liability Account.

10. Sir,we are celebrating the 150^th year of Indian Railways as 'Passenger Amenities Year'. Indian Railwayswill be completing 150 years of glorious service to the nation this year. On this occasion, Indian Railwaysexpresses gratitude to its customers whose continued support has enabled all round development of this vastnetwork. Mahatma Gandhi, the father of nation, had a close association with Railways. As stated by Bapu, thecustomer is the most important visitor on our premises. Hence, it is our primary duty to ensure thesatisfaction of customers and for this reason I dedicate the year 2003-2004 to our customers and declare it as‘Customer Satisfaction Year’. This year several steps relating to safety, security, punctuality andcleanliness will be taken so that customers would derive greater satisfaction from the Railways.

11. Iam aware of the concern expressed both inside and outside Parliament on the vital issue of safety. Inpursuance of the commitment made by me during the Winter Session of Parliament, a White Paper covering theentire spectrum of the issues involved in safety in train operations would be presented during the course ofthis session.
12. Oneof the major contributing factors for accidents has been found to be human failure. In this context, thefilling up of vacancies in safety categories in Group 'D' has assumed importance. It has been decided to fillup more than 20,000 such vacancies through Railway Recruitment Boards within the next one year. Training playsan important role in increasing the efficiency of the employees. Railways are determined to effect continuousimprovement in Safety related training and to enable this, the training facilities at all Zonal TrainingCentres, seven Supervisory Training Centres and eight Central Engineering Training Centres are being suitablyupgraded. Modules on Disaster Management are also being prepared. To this end, new works at a cost of Rs. 41crores are proposed to be taken up.

13. ACDis an intelligent microprocessor based equipment developed indigenously to prevent collisions. When installedon locomotives, brake vans and at stations and level crossing gates, these ACDs network among themselves toprevent accident like conditions involving collision of trains.
14. Extendedfield trials of this device on Jalandhar-Amritsar section of Northern Railway have been successfully completedon19th January 2003. Now, deployment of this device on Indian Railways has started. Provision of ACDs on about1800 route kms section and ACD survey on 1641 route Kms section are in progress. During 2003-2004, toaccelerate the pace of this work, it is proposed to carry out ACD survey of 10,000 route kms. and provide ACDover additional 1750 route kms.

15. Continuoustrack circuiting enables detection of discontinuities caused by rail/weld fracture or acts of sabotage. Thishelps in taking timely precautionary measures and prevents possible accidents. This will also improve the linecapacity and safety at level crossing gates. The work of track circuiting is being executed within stationlimits. Work of continuous track circuiting in block sections on selected sections of ‘A’ , ‘B’ and‘C’ routes at a cost of Rs 425 crores is now being proposed in this Budget.

16. Forupgrading and modernizing the bridge inspection and management systems, action has been taken to initiateunderwater inspections, computerized non-destructive testing with state of the art equipment and introduce amodern Bridge Management System.

17. Tominimize injuries during rail travel, coaches are being redesigned without any sharp corners in the interiorand duly padding up vulnerable areas. In order to prevent coaches from climbing over each other in the eventof a collision, tight lock couplers are being introduced progressively. Concurrently, redesigning coach endsto take the full impact of the collision has been undertaken so that passenger areas remain free from damagedue to collision or heavy impact.

18. During2001-2002 the actual expenditure under SRSF stood at Rs. 1434 cr (Net) as against the allotment of Rs 1400 cr.The safety surcharge fell short of the targeted collection by Rs.95 cr. Thus, the additional amount of Rs.129cr required on both these counts was made available through Railways’ normal revenues. In the current year,the total net allocation for SRSF was stepped up to Rs. 2210 cr as per the Budget Estimates, which included Rs.1350 cr as contribution from General Exchequer and Rs 860 cr from the safety surcharge. This has been furtherincreased by Rs.100 cr. in the Revised Estimates to keep up the pace of progress of safety works under SRSF.Railways are contributing this additional amount as well as the current year’s shortfall of about Rs.200 cr.in surcharge collection from its own revenues.
19. Asregards the physical progress of the works, I would like to inform that track Renewal of around 5,400 km isalso expected to be completed by the end of the current year. Rehabilitation of approximately 745 bridges islikely to be completed by the end of the current financial year. So far signalling equipment replacement workshave been completed at 298 stations. Further, about 1350 track circuits have been provided till now.

20. Activeconsultations are on with the concerned Ministries to give a final shape to the proposal to amend the RPF Actand Railway Act in order to provide enhanced powers to the RPF .
21. Tostrengthen the Railway Protection Force and the Railway Protection Special Force, recruitment of over 3500constables will be done through Railway Recruitment Board in the year 2003-2004.

22. Forfurther improving the punctuality of passenger services, it is proposed to streamline and strengthen themonitoring mechanism so as to control the factors, barring force majeure, that affect punctuality. To thisend, it is proposed to introduce a new computerized Coaching Operations Information System (COIS).

23. Onthe occasion of Independence Day, the Hon’ble Prime Minister announced the launching of `OperationCleanliness` to ensure cleanliness in trains and on railway premises. A task force has been constituted toframe an action plan for this. The responsibility of ensuring cleanliness in Railways rests with manydepartments. To cleanse the cleaning operations in Railways there is a need to establish a unified control.Apart from optimal utilisation of men and material resources available with Railways, it will also benecessary to induct costly equipment, in which the private sector will also be associated.

24. Encouragedby the response to the pilot project of the Unreserved TicketingSystem in Delhi, it is proposed to implement this in other areas of Northern Railway and on North Eastern, EastCentral, Eastern and Northeast Frontier Railways.
25. Toobtain a refund against a reserved ticket after the departure of a train is still a problem for thepassengers. Hence, in addition to the existing facilities, it is proposed to permit refunds of the amount duefrom any PRS center, three hours after the train has reached its destination.
26. Incase a confirmed or RAC ticket is lost by a passenger, a duplicate ticket can be issued, before preparation ofReservation Chart, on payment of 10 percent or 25 percent of full fare based on the distance of journey ortype of train. As a customer friendly measure, it is proposed that charges for issuing such a duplicate ticketwould be refundable at a PRS Centre at the destination on completion of the journey performed on such aticket.

27. Encouragedby the utilization of the integrated warehousing facility at Whitefield terminal at Bangalore, Railways intendto enter into an MOU with the Central Warehousing Corporation as its strategic partner for development ofsimilar integrated rail-side warehouse complexes at 22 locations.
28. Greaterflexibility has been given to the General Managers to improve the rail share of freight, through delegatedpowers to offer concessions ranging from 10 percent to 24 percent on Station to Station rates and alsobringing the consignees as well as the consignors within the scope of the scheme.
29. Fiveweekly Parcel Express trains are being run by railways, which include three trains connecting Delhi, Mumbaiand Chennai to Guwahati. One train each is running from Delhi to Kolkata and to Bangalore. More such trainswould be introduced between Amritsar and Mumbai via Delhi; from Delhi to Guwahati routed through Moradabad,Lucknow and Gorakhpur and between Mumbai and Kolkata.

30. Asannounced in last year’s Railway Budget, a prototype Refrigerated Van has been developed by Rail CoachFactory, Kapurthala. It is proposed to induct during 2003-2004 ten refrigerated vans in popular long distancepassenger trains for moving perishable commodities.

31. SeniorCitizens of our country are being granted 30 percent concession in fares in all classes and in all trains.This concession is available to men of the age of 65 years and above and women of age sixty and above. I amglad to announce that now both men and women will be entitled for the Senior Citizen concession on attainingthe age of 60 years.
32. Cancerand "Thalassemia Major" patients and heart patients, travelling for the purpose of heart surgery,alone or accompanied by an attendant, are presently entitled to a concession of 75 percent in First Class andSecond Class. It has been decided to extend 75 percent concession in AC 3-Tier and AC Chair Car and grant 50percent concession in AC First Class and AC 2-Tier of Mail/Express trains. Kidney patients undertaking trainjourney for the purpose of treatment would also be granted similar travel concessions.
33. AccreditedPress Correspondents are currently entitled to 50 percent concession for travel upto 30,000 kilometers peryear, in all classes of Mail/Express trains, if they are residing within 25 kilometers from the concernedcapital city or district headquarter. I am glad to propose that the limit on their concessional travel as wellas the distance restriction for their place of residence is removed. Further, Accredited Press Correspondentswould now be granted 30 percent concession in Rajdhani and Shatabdi Express trains also.
34. Thecommunication system available on Rajdhani & Shatabdi Express trains for making public announcements andplaying music on running trains are being extended to Jan Shatabdi Express trains also. It has now beendecided to adopt a policy of playing only instrumental music, appropriate to the season and the time of theday, in all such trains.

35. Aswas reported last year, an MoU was signed by Ministry of Railways with NTPC for setting up of captive thermalpower plants. I am happy to state that the project committee consisting of representatives from NTPC andRailways formed for the purpose has, after examining four different sites, recommended Nabinagar as a suitablesite for a 1000 MW thermal plant, which has been accepted. It is now proposed to form a Joint Venture Companyof Railways with NTPC for implementation of the scheme.

36. TheRailways are also exploring alternative fuel sources. A massive drive for planting Ratan Jyot plants on bothsides of the Railway land has been embarked upon. Bio-diesel, which can be distilled from Ratan Jyot by asimple and inexpensive refining process, can be freely mixed with diesel oil used on our locomotives. This isan initiative that is not only environment friendly, but will also result in reducing our fuel bill.
37. AnMoU has been signed on 12.2.2003 with Indian Oil Corporation for a pilot project in which they will grow RatanJyot plants on Railway land and sell the oil produced from them back to the Railways.

38. Hon’bleMembers are aware of the decision to operationalise seven new zones and eight new divisions. The North WesternRailway and East Central Railway headquartered at Jaipur and Hajipur respectively have become operationalw.e.f. 01.10.2002. The remaining five new zones viz., East Coast Railway at Bhubaneswer, North Central Railwayat Allahabad, South East Central Railway at Bilaspur, West Central Railway at Jabalpur and South WesternRailway at Hubli and eight new Divisions headquartered at Agra, Ahmedabad, Guntur, Nanded, Pune, Ranchi,Rangiya and Raipur shall be operationalised w.e.f. 01.4.2003. OSDs in the rank of General Managers and DRMs tohead these new zones and divisions respectively are already in position. The feedback received indicates thatthe two new zones that were operationalised w.e.f. 01.10.2002, viz. North Western Railway and East CentralRailway have been functioning with improved efficiency.
39. Togive a greater focus to the R&D activities, the status of RDSO has been elevated to a ‘Zonal Railway’from that of an ‘Attached Office’ to the Railway Board with effect from 01.01.2003.

40. Totransform the Indian Railways into customer-oriented organization, it is proposed to improve its accountingsystem. In this regard, it is planned to review the existing accounting policies and practices and tointroduce fully computerized accounting and Management Information System so as to generate costing data onpassenger and freight services on commercial lines.
41. OurProduction Units have been catering mainly to the needs of Indian Railways. Having acquired the State of theArt technology, Railway Production Units can now become competitive and can make their presence felt in theglobal market provided they are given the requisite autonomy. In order to facilitate this, it is proposed torestructure the production units as independent cost and profit centers.

42. NationalRail Vikas Yojana, announced on 15^th August, 2002, at an estimated cost of Rs.15,000 crore, hasbeen formally launched on 26^th December, 2002 by the Hon’ble Prime Minister. A company named"Rail Vikas Nigam Limited" has been incorporated under the Companies Act for implementation of theseprojects including raising of resources. Strengthening of the Golden Quadrilateral and its diagonals throughidentified sub-projects costing about Rs.8,000 crore will form the major part of this yojana. A part loan ofUS$ 313.6 million has been approved by ADB. It will be utilized, mainly, for execution of projects coveredunder the initiative of "strengthening of Golden Quadrilateral". A dialogue with World Bank has beeninitiated to mobilize funds for "mega bridges" and other NRVY projects. Projects under theinitiative "port connectivity" have been identified and resource mobilization for the same isproposed to be organized through various public-private partnership initiatives and budgetary support.
43. Sir,as committed in my last budget speech, work has already commenced on three mega bridges i.e., Bogibeel bridgeover river Brahmaputra, two bridges over river Ganga, one at Patna and the other at Munger. I am happy toinform the House that the requisite clearances for the mega bridge over river Kosi have been obtained and thework has been included in the budget.

44. Hon’blePrime Minister, during his visit to Srinagar had announced that the first train will roll into Kashmir Valleyby 15^th August 2007. I express my gratitude to the Hon'ble Finance Minister, who has provided Rs.500 cr for this National project in 2003-04, considering its importance. The work on Udhampur-Katra andQuazigund-Baramulla sections is already in progress. The stretch between Katra – Quazigund is very difficultrequiring large scale tunneling and bridging works for which detailed surveys on ground need to be carriedout. Considering the arduous nature of work, construction on this section has been entrusted to twotechnically sound organizations, viz., IRCON and Konkan Railway Corporation Limited while detailed survey hasbeen entrusted to RITES. I am happy to inform that long pending project of Jammu-Udhampur is progressing at asatisfactory pace and is targeted for completion by March 2004. Further, rail link upto Katra is likely to becompleted during 2004-2005.
45. Thetwo strategic projects, namely, gauge conversion from Luni to Munabao and new line between Kolayat and Phalodiare progressing satisfactorily and gauge conversion up to Samdari has already been completed.
46. Over1300 km of BG lines are likely to be added during the current year. Further, a target of addition of nearly1340 kms of BG lines has been set for 2003-2004.

47. Sir,I am happy to state that Kumarghat-Manu of Kumarghat-Agartala new line has already been completed andcommissioned on 27.12.2002 for passenger services. The restoration of Fatuha-Islampur has also been completed.It is hoped to complete restoration of Duraundha-Maharajganj and new lines between Katra-Faizabad andJoruli-Keonjhar during the year. Further, the work of Daulatpur-Malikpur and Bajkul-Nachenda are also likelyto be completed by March 2003. The balance targeted portion of these lines i.e. from Malikpur to Balurghat andNachenda to Kanthi are expected to be completed by June 2003.
48. In2003-2004, Railways propose to complete 225 km of new lines including following sections:

49. Duringthe year, the gauge conversion of Vadalur-Vriddhachalam, Dharmabad-Nizamabad and Jankampet-Bodhan has alreadybeen completed. I am happy to state that against the original target of 791 km of gauge conversion set for thecurrent year, nearly 900 km of gauge conversion is likely to be achieved. This includes Latur-Latur Road newline portion of Miraj-Latur, Mangalore-Kabakaputtur, Virudunagar-Rajapalaiyam, Katpadi-Pakala-Tirupati,Surendernagar-Pipavav, Rajkot-Junagarh and Samdari-Jasai where the works of mega block are already inprogress.
50. Duringthe year 2003-2004, a target of over 775 km of gauge conversion has been proposed which include the followingsections:

74. Hon’bleMembers will be happy to know that weekly frequencies of some popular trains shall be increased. Details aregiven below :-

1. 2313/2314Sealdah-New Delhi Rajdhani Express from 4 days to 5 days
2. 2443/2444Bhubaneshwar-New Delhi Rajdhani Express from 1 day to 2 days.
3. 2439/2440Ranchi-New Delhi Rajdhani Express from 1 day to 2 days.
4. 2441/2442Bilaspur-New Delhi Rajdhani Express from 1 day to 2 days
5. 2129/2130Pune-Howrah Azad Hind Express from 4 days to 5 days.
6. 2561/2562Darbanga-New Delhi Swatantrata Senani Express from 4 days to daily.
7. 5025/5026Gorakhpur-Mumbai (Lokmanya Tilak Terminus) Godaan Express from 1 day to 3 days.
8. 4311/4312Bareilly-New Bhuj Ala Hazrat Express from 2 days to 4 days
9. 7017/7018Secunderabad-Rajkot Express from 2 days to 3 days.
10. 2101/2102Mumbai (Lokmanya Tilak Terminus)-Howrah Jnaneshwari Express from 3 days to 4 days
11. 5631/5632Guwahati-Jodhpur and Bikaner Express from 1 day to 2 days.
12. 2141/2142Patna-Mumbai (Lokmanya Tilak Terminus) Express from 4 days to 6 days.
13. 2905/2906Howrah-Hapa Express from 1 day to 2 days

1. 2983/2984Jaipur - Durg Express to Bilaspur
2. 9113/9114Jammu Tawi-Amritsar Express to Firozepur
3. 7029/7030Hyderabad-Ernakulam Sabari Express to Trivandrum on 3 days a week
4. 9169/9170Varanasi-Ahmedabad Express to Okha
5. 6512/6511Bangalore (Yeshwantpur) - Durg Express to Bilaspur
6. 8611/8612Ranchi-Garwa Road Express to Varanasi
7. 6513/6514Bangalore (Yeshwantpur)-Solapur Express to Bijapur
8. 2905/2906Howrah-Hapa Express to Porbander
9. 6305/6306Ernakulam – Calicut Express to Cannanore
10. 8189/8190Alleppey - BokaroExpress to Dhanbad
11. 297/298Kota-Gwalior Passenger to Bhind
12. 9503/9504Jamnagar – Ahmedabad Inter City Express to Surat
13. 9307/9308Indore-Gwalior Express to Bhind
14. 8183/8184Danapur-Bilaspur South Bihar Express to Durg (Daily)
15. 1/2CCM Mirzapur-Chopan Passenger to Shaktinagar and Allahabad
16. 409/410Bilaspur-Shahdol Passenger to Rewa
17. 3149/3150Sealdah-New Jalpaiguri Kanchan Kanya Express to Alipurduar after Gauge conversion
18. 1463/1464Jabalpur-Rajkot Express to Veraval after Gauge conversion
19. 103/104Chennai Egmore-Villupuram Passenger to Pondicherry after Gauge conversion
20. 437/438& 439/440 Mankapur-Katra Passenger trains to Faizabad
21. 3467/3468Bhagalpur-Patna Vikramshila Express to New Delhi.
22. 2069/2070Raigarh-Durg Janshatabdi to Dongargarh.
23. Delhi-KotaCoaches of 9019/9020 Mumbai (Bandra) – Dehradun Express to Nimach
24. 7225/7226Vijayawada-Hubli Amravati Express to Vasco once a week.

77. Sir,I would now like to present the Annual Plan 2003-2004. The Plan outlay for 2003-2004 has been kept at Rs10,607 cr. Taking into account the outlay of Rs 2,311 cr on safety related works through the Special RailwaySafety Fund (SRSF), the total outlay comes to Rs 12,918 cr. This is Rs 603 cr higher than the RevisedEstimates of last year. For the year 2003-2004, the total funds received from General Exchequer are Rs 6,577cr, including Rs 1,600 cr as contribution towards the SRSF and Rs 433 cr from the Central Road Fund. This alsoincludes Rs 730 cr specifically for investment in the newly created Rail Vikas Nigam. The corresponding figurefor 2002-2003 was Rs 5,840 cr, including Rs 1,350 cr for the SRSF and Rs 450 cr from the Central Road Fund.
78. Inaddition to the budgetary support, Railways propose to provide Rs 2,630 cr for plan expenditure throughinternal resource generation. This is at the same level as was budgeted for last year. The balancerequirements of the Plan would be met through extra-budgetary resources, which include Rs 2,970 cr as marketborrowing from Indian Railways Finance Corporation and Rs 30 cr as investment through a "BOT"project in the Viramgam-Mehsana Gauge Conversion work. For the Special Railway Safety Fund, the contributionof the Central Government would be supplemented to the extent of Rs 711 cr through Safety Surcharge, takingthe total outlay under SRSF to Rs 2,311 cr.
79. Sir,the total outlay under Capital on the five major plan project heads this year has been kept at Rs 2,716 crwith Rs 1,005 cr on New Lines, Rs 703 cr on Gauge Conversion, Rs 443 cr for Doubling and Rs 122 cr forElectrification. The outlay on metropolitan transport projects, which has been kept at Rs 443 cr, includesmulti-lateral funding for the Mumbai Urban Transport Project.
80. Apartfrom this, Rs 730 cr are being allotted to several works in the planheads New Lines, Doubling, GaugeConversion and Railway Electrification, which are to be executed by the Rail Vikas Nigam.
81. Theoutlay on safety related planheads, inclusive of outlay given under the Special Railway Safety Fund, is Rs2605 cr for Track Renewals, Rs 302 for the Bridges and Rs 689 cr for Signalling & Telecommunications.

Part – II

82. Sir,I shall now deal with the Budget Estimates for 2003-2004.
83. TheRailways are expecting to carry 540 million tonnes of revenue earnings originating traffic during 2003-2004,which is 25 million tonnes more than the traffic of 515 million tonnes likely to be lifted in the current yearand this increase is higher than the average incremental freight achieved in the last few years. However,taking note of the prevailing trend in the economy and the various measures being taken by the Railways, thistarget is expected to be achieved. The originating passenger traffic is estimated to go up by about 3 per centresulting in increase in earnings of 7 per cent over the Revised Estimates of the current year. The ‘OtherCoaching’ earnings are expected to grow by 7 per cent. Sundry Other Earnings, for 2003-2004 have beenestimated at Rs 990 cr, representing a growth rate of 5 per cent over the Revised Estimates of the currentyear.
84. Onthe basis of these assumptions, the Gross Traffic Receipts (GTR) are estimated at Rs 43,495 cr. These are Rs2,628 cr higher than the Revised Estimates of the current financial year.
85. Railways'Ordinary Working Expenses estimated at Rs 32,460 cr are 7 per cent higher than the Revised Estimates of thecurrent year. Appropriation to Pension Fund is placed at Rs 6,385 cr. Based upon the anticipated requirementfor plan resources, a provision of Rs. 2005 cr has been made towards Appropriation to Depreciation ReserveFund .
86. Thetotal Working Expenses will, thus, amount to Rs 40,850 cr leading to the Net Traffic Receipts of Rs 2,645 cr.Net Miscellaneous Receipts are estimated at Rs 888 cr, which also take into account the amount likely to becollected through levy of surcharge on passenger fares for being appropriated to the Special Railway SafetyFund. Thus, the Net Revenue works out to Rs 3,533 cr.
87. Amemorandum on the rate of dividend payable to General Revenues has been submitted to the Railway ConventionCommittee. Meanwhile, dividend for 2003-2004, has been provided at the same rate as adopted for 2002-2003. Onthis basis, dividend liability for 2003-2004 works out to Rs 2,930 cr. Along with certain other dues, anamount of Rs 2,978 cr becomes payable to the General Revenues. This liability will be discharged in full.
88. Theabove projections are expected to yield funds sufficient to meet the requirement of the Plan outlay for theyear, from the internal resources.
89. Witha view to make the Freight rates and Passenger fares competitive and increase Railways’ share in transportsector, it is necessary to continue the process of rationalisation and re-balancing of Tariffs. In order toattract more traffic to rail, I am proposing certain other measures and reforms.

90. Sir,for year 2002-2003 I did not make any across-the-board increase in freight rates. For the year 2003-2004, I donot propose any increase in freight rates for any commodity.
91. Whilerationalising the freight structure, the total number of classes was reduced from 59 to 32 with Class-90 asthe lowest class and Class-300 as the highest class. In freight structure so rationalised, the ratio betweenthe highest and the lowest freight rate was reduced from 8.0 to 3.3. It is proposed to reduce further the bandof freight rates through compaction in freight classification by lowering the highest class from Class-300 toClass-250. In the revised classification, the total number of classes will be reduced from 32 to 27 and theratio between the freight rates for the highest and the lowest class will be further reduced from 3.3 to 2.8.
92. Tomake the freight rates competitive, it is proposed to reduce the classification of certain commodities whereRailways are facing stiff competition due to high freight rates. The classification of Petrol for trainloadmovement is proposed to be reduced by three stages from Class-280 to Class-250, lowering the freight rates by10.7 per cent. The classification of certain other commodities is proposed to be reduced by two stages. Thesecommodities include High Speed Diesel Oil (HSD), Furnace Oil, Crude Oil, Naptha, Liquefied Petroleum Gas(LPG), Compressed Gases, Lubricating Oils, Iron & Steel, Pig Iron, Iron Scrap, Cement sheets, PetroleumCoke and Soda ash. Some of the liquid commodities, carried in tank wagons, namely Molasses, Bitumen, Refinedvegetable oils (Div. A), and Sulphuric acid are also proposed to be charged two stages lower than theirexisting classes. The proposed reduction in freight rates due to lowering of classification by two stages willrange from 5.3 per cent to 9.5 per cent. The classification of Cement, Clinker, Manganese Ore and Caustic SodaLiquid (in tank wagon) are proposed to be reduced by one stage, which will reduce the freight rates by around3.7 per cent. Details of the re-classification of these commodities, along with the existing and proposedfreight rates for selected distances, are given in the Memorandum Explaining the Budget Proposals forAdjustment in Freight Rates and Fares.
93. Thereare certain groups of commodities, which are assigned different classes based on their different physicalforms such as lumps, powder etc. In order to initiate simplification in the classification of such groups ofcommodities, which are loadable upto the full carrying capacity of wagons, a single uniform class will beassigned for each such group. Iron Ore, in its different forms, such as lumps, powder, fines, pellets etc.,which are currently classified from class-120 to class-125 would now be charged uniformally under class-120for trainload. Similarly, other selected groups of commodities, namely Manganese Ore, Gypsum, Bauxite,Limestone & Dolomite, Soapstone and Chalk will be assigned a single uniform class for each group. Thedetails of the existing and proposed classification of these groups of commodities are given in the MemorandumExplaining the Budget Proposals for Adjustment in Freight Rates and Fares.
94. Inorder to increase its share in transportation of Petroleum products, Railways are ready to consider long- termagreements with individual oil companies for further reduction in freight rates on sector-to-sector basis ifguaranteed volumes of additional traffic are committed for rail movement.
95. Withthe liberalisation of Indian economy, the pattern of industrialisation is undergoing a significant change withproduction centres coming closer to the source of raw materials or consumption centres. The average distancesover which some of the major commodities are moved by rail have been gradually declining and Railways have totake various measures to capture short lead traffic. In the Railway Budget 1999-2000, freight concession of25% was granted to traffic booked for distances upto 50 km. as the minimum distance for charge is 100 km. Thismeasure has shown positive results and generated additional revenue to the Railways. It is now proposed torationalise the charging of freight for all traffic booked upto 100 km. through a scheme of gradedconcessions. Under this scheme, 50 per cent freight concession will be allowed for traffic booked upto 50 km.followed by 25 per cent concession from 51 km. to 75 km. and 10 per cent concession from 76 km. to 90 km. Inthe proposed rationalisation, the freight rate per tonne per kilometer for these distance slabs would beexactly the same.
96. Therail users have an option to pay freight charges either at the time of booking or at the time of delivery atdestination station. Presently, if the freight is not paid at the time of booking, a ‘to-pay’ surcharge of10 per cent on normal freight is levied for all commodities other than Coal. In the case of coal traffic, 15per cent "to-pay" surcharge is levied. The rail users consider this surcharge excessive. Therefore,it is proposed to reduce the ‘to-pay’ surcharge from 15 per cent to 10 per cent for coal and 10 per centto 5 per cent for all other commodities.
97. Thereare many commodities, which have a wagonload class only. It has been decided that any commodity, which hasonly a wagonload class, will be assigned a trainload class one stage lower than its wagonload class. As aresult, the freight will get reduced by around 4.00 per cent to 5.26 per cent if such a commodity is nowoffered for trainload booking.
98. Freightmovement on the Indian Railways is predominantly in the form of block rakes from one originating station to asingle destination point. However, with a view to reduce the carrying cost of the customers, block rakemovement from one originating station to two destination points close to each other and vice-a-versa is alsobeing permitted. At present, such two-point block rakes enjoy the benefit of lower trainload rates only uptothe common point of movement. It has been decided that two-point block rakes will now be granted the benefitof trainload rate for the entire distance of transportation.
99. Atpresent, clubbing upto six consignments is permitted in a broad gauge 8-wheeler wagon. In order to providerail transportation to a larger number of traders and retailers, it has been decided to allow clubbing uptotwelve consignments, on payment of Rs 100 for every additional Railway Receipt.
100. Thewages of the railway staff deployed in private sidings are being traditionally charged to the siding owners.In order to give relief to the siding owners, Zonal Railways will undertake a thorough review to reduce thecost of railway staff being charged to the private siding owners in a phased manner.
101. Sidingowners generating freight earnings of more than Rs. 25 crore per annum from traffic originating from theirsidings have been designated as Premier Customers of the railways. An incentive scheme for the PremierCustomers to help them increase the rail share of transport is being introduced. Premier Customers would begranted a freight rebate of 2 per cent for every five crore rupees of net additional originating freightearnings over the previous financial year generated to the railways. The rebate under this scheme will begranted in addition to any other freight concession availed by them. However, this incentive scheme will beapplicable to net additional originating freight earnings from commodities placed in Class-135 and above.

102. Sir,this year I do not propose any increase in Passenger fares.
103. Lastyear, the fare structures of Mail/Express, Ordinary Passenger trains and Monthly Season Tickets (MST) wererationalised. This year, it is proposed to rationalise the fares of Rajdhani and Shatabdi Express trains. Aseparate fare structure for Rajdhani and Shatabdi Express trains was introduced in the year 1995-96 which doesnot have a fixed relationship with the fares of Mail/Express trains. It is now proposed to link the fares ofRajdhani and Shatabdi Express trains to the rationalised fare structure of Mail/Express trains, fixing thebasic fare for each class of Rajdhani and Shatabdi Express trains 15 per cent higher than the fares ofcorresponding class of Superfast Mail/Express trains on a uniform basis. Charges for catering services, as perrequirement of the journey, would be added to the basic fares. Sir, as a result of this rationalisation, thebasic fares of different classes of Rajdhani and Shatabdi Express trains will be lower for most of the pairsof stations. In exceptional cases, fares may be marginally higher for a few pairs of stations in which case,the existing fares will apply. The details of the existing and proposed end-to-end fares for Rajdhani andShatabdi Express trains are given in the Memorandum Explaining the Budget Proposals for Adjustment in FreightRates and Fares.
104. Iam glad to inform that all the sixteen Jan Shatabdi Express trains, announced during last year’s RailwayBudget have been introduced. The fare structure for Jan Shatabdi Express trains was fixed 10% higher than thefares of Superfast Mail/Express trains. Additional charges for catering services were included in the ticketfare. To make Jan Shatabdi Express trains more popular, it is proposed to reduce the basic fare from theexisting mark-up of 10% to 5% over the fares of corresponding class of Superfast Mail/Express trains and makethe catering services optional on these trains.
105. Inorder to benefit the passengers and also to give competitive edge to rail travel, it is proposed to introducethe concept of reduced fares in selected trains during the non-peak period. As an experimental measure, 10 percent reduction in the basic fares of AC First and AC 2-tier of all Rajdhani Express trains would be given fortravel during the period from 15^th July to 15^th September this year.
106. Atpresent, if a wait-listed passenger boards a Rajdhani or Shatabdi Express train, excess fare, equal to theticket fare, is charged. It is felt that this penal charge needs a revision. It has been decided that therules in respect of waitlisted passengers boarding Mail/Express trains will now be applicable to waitlistedpassengers of Rajdhani, Shatabdi and Jan Shatabdi Express trains also.

107. Inorder to simplify the booking procedure of Parcel and Luggage traffic and optimize the use of transportcapacity available for carriage of parcels by different trains, it is proposed to rationalise the ratestructure for booking of Parcel and Luggage traffic. At present, parcels are charged under seven differentScales based on the type of the commodity. It is proposed that all types of commodities, including Luggage,will now be charged uniformly at the same rate, under four Scales, depending on the type of service selectedby the customer. The highest Scale-R, for Rajdhani service, will be applicable to all Rajdhani Express Trains.The next Scale-P will be for Premier service by certain notified Mail/Express trains. The next lower Scale-S,for Standard service, will apply to other Mail/Express, Shatabdi Express and Parcel Express trains. The lowestScale-E will be for Economy service by Ordinary Passenger trains. In the rationalised structure, the number ofScales for charging of Parcel and Luggage traffic will be reduced from 7 to 4 and the ratio between thehighest and the lowest rates will reduce from 8.7 to 6.2 Newspapers and Magazines will now be charged at thesame rates under the lowest Scale-E by all trains. The rationalised rates for Parcel traffic under the newstructure will be lower than the existing rates. The details of the existing and proposed rates for differentcommodities between a few selected pairs of stations are given in the Memorandum Explaining the BudgetProposals for Adjustment in Freight Rates and Fares.
108. Allthe above proposals will come into effect from 1.4.2003.
109. Sir,achievements of a vast organisation like Indian Railways reflect the sincerity and dedication of therailwaymen, who deserve appreciation. They will ever be ready to fulfil the public expectations andaspirations. I express my gratitude to respected Prime Minister for his continued encouragement and kindsupport and I firmly believe that Indian Railways would establish new dimensions of progress under hisguidance. I also thank and express my gratitude to Hon'ble Finance Minister for giving adequate support to theRailways. I am confident that they would be obliging the Railways by providing additional funds generously inthe coming year for accelerated execution of the Railway Projects. I thank Hon'ble Members for their supportand suggestions and hope that they would continue the same in future too.
110. Sir,with these words I commend the Railway Budget 2003-2004 to the House.