An elaborate exercise till 2016 that gave immense clout to successive railway ministers, the railway budget was dismissed in a few broad clinical strokes by finance minister Arun Jaitley in his speech on Thursday. He went through the railway allocation at the speed of a bullet train.
There were no new trains, no new projects that were announced. The emphasis was on much-needed capacity building and consolidation with the clear message of “Safety First” policy emanating from railway minister Piyush Goyal. Incidentally, Goyal is the third railway minister in Narendra Modi government, preceded by Suresh Prabhu and Sadananda Gowda.
The railway budget, merged with the general budget, allowed him the luxury of not having to reveal the Operating Ratio (OR) and other uncomfortable facts about the state of railway finances. He didn’t have to answer, why did railways grow 0.2 per cent when the country’s economy grew at 6.5 per cent in 2017?
Evan as Jaitley pegged railways’ capital expenditure at Rs 1.48 crore, with focus on capacity creation including new tracks, doubling, electrification, rolling stock and station redevelopment, there was no mention of railway fares – once the most talked-about aspect of the railway budget. Whether the fares were increased, decreased or left untouched was the main criterion to term the budget as “populist” or “progressive”. One railway minister – TMC’s Dinesh Trivedi – lost his job when he dared to increase the passenger fares marginally in opposition to the “advise” given to him by his party leader Mamata Banerjee, then part of the UPA government.
Suresh Prabhu, in his budget speech in 2015-16, announced setting up of Rail Development Authority (RDA) to regulate fares and suggest measures for enhancing non-fare revenue among other things. Flagged as a major reform, it took the Cabinet two years to approve the same. One year down the line, the RDA is still nowhere in sight.
Rail Bhavan sources tell Outlook that the future of RDA is uncertain. “It is not sure whether it will actually be set-up. Nobody seems to be interested in it,” reveals a senior officer. While Prabhu ostensibly may have left the fares untouched, the railways quietly shifted to a flexi-fare system – something like the airlines follow.
“It is worse than the airlines model which is more dynamic. Air fares can come down even closer to the date of travel if seats remain unsold. However, in the railways, once half the seats are booked, the fares start rising at the rate of 10 per cent. By the end of it, the fare can see an increase of up to 50 per cent,” he explains. The worst, according to him, is that unlike airlines, railways will not reduce prices even if 20 per cent seats remain unsold.
A retired railway officer booked an AC III Tier ticket from Delhi to Mumbai in Rajdhani last week. “Only after I completed the transaction, I realized that the ticket cost me Rs 2,750. The base fare for the same is about Rs 1,700. Later, I found that the air ticket for that day was available for Rs 2,000,” he rues.