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Indian Railways losing steam with freeze on fare hikes
With
passenger fares on a freeze for years and little money to expand
the world's second largest railroad network under a single
management, Minister Dinesh Trivedi has an unenviable task when he
presents the annual Railway Budget March 14.
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New Delhi: With
passenger fares unlikely to be hiked, Railway Minister Dinesh
Trivedi will present his maiden railway budget for 2012-13
Wednesday amid concerns over the financial health of the world's
second largest network.
A cash strapped Indian Railways, which runs 10,500 trains and
ferries 22 million passengers daily over 64,000 km of track, is
looking at an earnings shortfall of Rs.7,000 crore.
Poor financial management has left Indian Railways staring at an
earnings shortfall despite gross budgetary support of Rs.20,000
crore last year and a Rs.3,000 crore loan approved by the finance
ministry Feb 6.
"It is an unprecedented situation," a senior railway official
commented on condition of anonymity while describing the financial
crisis.
Recently, two expert panels, headed by former Atomic Energy
Commission chairman Anil Kakodkar and prime minister's adviser Sam
Pitroda, said the railways would need around Rs.9 lakh crore over
the next five years to follow the safety and modernisation road
map suggested by them.
No one knows where the money will come from.
Passenger fares have been on a freeze since 2002-03 as Trinamool
Congress chief Mamata Banerjee, a former railway minister, is
opposed to hiking fares.
In the process, the railways has little money to expand the
network. Trivedi is also a Trinamool man.
With 19 members in the Lok Sabha, the Trinamool Congress is a
crucial ally of the Manmohan Singh-led United Progressive Alliance
(UPA) and has often shelved key reforms such as foreign equity in
retail.
"Revision of passenger fares is long overdue. The railways need to
invest in additional lines and build more rakes," former Railway
Board chairman R.K. Singh told IANS.
What bothers the railways is the fact that its operating ratio now
stands at 100 percent, up from 75 percent in 2008-09. This means
every rupee generated is spent on running the network, with no
room for expansion.
"All big projects are at a standstill. The railways are unable to
maximise earnings," said Singh, adding there was no money left to
address crucial areas like the renewal and replacement of existing
assets and taking up further development projects.
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