Creeping Privatisation: 6 Signs
- The Ticket Trick Rail Budget injects two radical reforms—a fares regulator and segregation of fuel in passenger costs—ignored by previous ministers. If cleared, ticket rates could go up or down depending on fuel price of the day.
- Eye On Infrastructure Models are being developed to allow private players to enter in fixed rail infrastructure—stations, high-speed lines, manufacturing of locos, coaches, wagons—in the form of public private partnership (PPP) projects.
- Prime Real Estate With one lakh acres of surplus land—and prime land in urban centres—Railways is parcelling out/leasing out land to developers on 30-90-year leases. Land being “developed” in Delhi, Bangalore, Vijayawada, Gaya and Gwalior. Total number of sites: 52. Total land size: 1,527 hectares. Potential earnings: Rs 5,500 crore.
- Corporatise Backend As it did with freight, the idea is to restructure the management on business lines—this budget announced a Logistics Corps for railway goods sheds, warehouses. On the cards: managing passenger traffic, maintenance and expansion of tracks.
- Outsource Services Non-core functions—hospitality, maintenance, technology, catering, hotels—are being given to private players. The railways insist this is “commercialisation”, and not “privatisation”.
- Change The Rules Planning Commission bid to change bidding process for two PPP locomotive plants in Bihar rings a bell with similar PPP moves in power, highways, airports. Current PPP projects: Rs 1,166 crore. PPP projects in the pipeline: Rs 99,064 crore.
Story Behind Trivedi's Budget
- Senior government and railway officials say Dinesh Trivedi’s railway budget was crafted with the major backing of the Planning Commission in a manner not seen during the tenures of previous railway ministers Laloo Prasad Yadav and Mamata Banerjee.
- Trivedi’s proximity to railway reforms panel head Sam Pitroda is grist for the gossip mills in Rail Bhavan. There are some who view a potential conflict of interest in Pitroda residing at Trivedi’s Delhi home while his house was being readied.
- Trivedi has gone on record in TV interviews to say that he had approached American investor Warren Buffett to “invest” in railway bonds and promised to clean up the railways to ensure this.
- Insiders say the major railway unions were worked upon to back the budget proposal for the rail fare hike (which has now been partially rolled back).