Higher train fares on the way


An imminent fare hike, the first in 10 years, will make 2013 a landmark year for the railways, apart from the fact that it will be a Congress minister presenting the rail budget for the first time in 16 years.

A hike will not only help the struggling railways mop up at least Rs 3,000-4,000 crore a year but, more importantly, also send signals to investors and lending agencies that have, by and large, been shying away from railway projects because the institution had been acting less like a commercial organisation than like one solely discharging social obligations.

Railway Minister Pawan Kumar Bansal has already increased the price of food served on trains and at stations to ensure quality. An upcoming Rail Tariff Authority, which will work out how best to determine fares and freights, is expected to delink fares from fluctuations in the prices of diesel and power by introducing a fuel adjustment component.

With 347 pending projects involving Rs 1.47 lakh crore weighing down the railways, 2013 could see priorities set, funds allocated accordingly, and introduction of fewer new trains.

The cabinet has cleared the engagement of more private players in laying of tracks for last-mile connectivity; this policy is expected to come into effect in 2013. Iternational bids for locomotive factories in Madhepura and Marohra will also be called this year.

Last year, railway minister Dinesh Trivedi increased freight by 10-15 per cent and then presented a rail budget with a 20 per cent hike in passenger fares, only to be ousted on the insistence of his party chief Mamata Banerjee. His Trinamool Congress colleague Mukul Roy took over and rolled back all those proposals, reducing the railways' earning estimate by Rs 4,000 crore. When the Trinamool Congress pulled out of the government, transport minister C P Joshi took additional charge of railways before Bansal became the year's fourth railway minister.

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