Rescuing railways

Deciding to set up a tariff authority is not enough. But it's a start

The Indian Railways (IR) had ground to a halt, in terms of both efficiency and safety, under the Trinamool Congress and its succession of railway ministers, from Mamata Banerjee to Mukul Roy. The decision to set up a Rail Tariff Authority was long overdue, given the imperative to de-link railway fares from populism — forever the bane of railway ministers. Railway Minister C.P. Joshi's announcement did not clarify whether the authority is going to be a regulatory or recommendatory body. Now that Banerjee no longer has IR in her grip, however, the Union government needs to move fast on it as one of the measures towards relief and rehabilitation.

Joshi could return to Dinesh Trivedi's reformist railway budget proposals, squelched by Banerjee's appointee Roy, and revisit the need to raise passenger fares, untouched for a decade. The Sam Pitroda- and Anil Kakodkar-headed high-level panels set up to advise on modernisation and safety had recommended both infusion of money from outside and fare hikes. The modernisation of IR, according to the Pitroda-led expert group, is said to require approximately Rs 5,60,000 crore over the next half-decade. Although Trivedi's 20 per cent hike in aam aadmi fares — rolled back by Roy — should ideally have been spread over a period of time, the fact remains that general-class passengers constitute 95 per cent of traffic, and time is not on IR's side. Another area requiring immediate attention is the operating (or cost-return) ratio, which Trivedi's budget had admitted was going to slip to 95 this year.

Chronically milked for populist purposes, IR has few resources left. Given the primacy of safety for a mass transporter like the railways, the behemoth must be able to borrow and make money for it. Otherwise, the anti-collision devices, fog-safety devices, manning of all level crossings, etc will remain on paper. The full scope of railway safety is a larger matter — from rake and engine redesign to retrofitting — which would mean modernising IR into a safe, lean, efficient and comfortable 21st century entity. What IR cannot afford to do ever again is running hotels, eco parks, sports academies, bottling plants, etc. Setting up a tariff authority is not enough — the railways must be given the autonomy to rationalise fares indexed to fuel costs. But it is a start.

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