Prabhu sets ambitious targets

Bullet trains not feasible for India; resource mobilisation difficult

The Railway Budget for 2015-16 presented by the Minister of Railways, Suresh Prabhu, seems to have set the basis for big ticket private entry into Railway sector. Though the goods proclaimed are laudable, how they are meant to be achieved is left out. A five-year investment plan has been projected for Rs 8.5 lakh crores, proposed to be utilised from multiple sources, which however is not clear.

For the first time, the statement of receipts and expenditure, performance of previous year, was not indicated in the budget presentation, thus leaving everything to guess and question.

While, emphasis was laid on certain passenger amenities, it has to be seen how much money is allotted to specified work, when a Pink Book is released by the Railway Board. Mention has been made on bio-toilets in coaches, vending machines, extension of reservation period others which already under implementation. Several other passenger facilities and facilities at stations have been proposed to be implemented by Indian Railway Catering and Tourism Corporation (IRCTC), which is nothing but an organisation brokering contracts.

It is stated that the train capacity will be augmented by increase in coaches from 24 to 26, which seems doubtful given that the maintenance lines and platforms can absorb not more than 24 coaches. It has also been stated that the speed of Express Trains will be increased from 110 to 130 kmph in certain sections, which is really welcome, but practically doubtful in view of saturation of the railway network and with no new lines in place.

The important source of the Railway earnings is freight, which is now proposed to be pushed to a new Transport Logistics Corporation of India (TRANSLOC), which will be run under PPP mode. Private Freight Terminals and Liberalized Wagon Investment Scheme will be made more liberal to attract private parties. A PPP cell will be revamped and given a high priority. Port connectivity, an important component, will be developed on PPP model. Without details, it is implied that FDI will be brought in a big way in manufacturing units of coaches, locomotives, in the name of ‘Make in India’. It is said that States may partner with the Railways to form Special Purpose Vehicles, which, however, is unlikely with the states in grip of huge deficits.

Internal resources mobilisation is pegged at Rs 17,793 crores over the previous year. Thus, it is feared that the Railways may prune the staff strength, which will have further serious impact on rail services. These fears are confirmed by the proclamation that the operating ratio will be brought from 91.8% to 88.5 %.

The proposal of introducing a bullet train between Mumbai and Ahmadabad is being pushed at high fares. The high speed train is a disputable concept in the sense that it costs over 20 times that for a normal train network. This is to be reviewed in the background of the comment of Paul Lafree, the CEO of ALSTON, the Bullet Train Manufacturer of the France, that the Indian conditions are not suitable for high speed trains and it is better to increase the speed of the existing trains. It is widely felt that a huge public investment by the government in the biggest infrastructure is imperative which can be emulated by the Chinese example where the government had invested 3 lakh crores in the current year.

By: K Siva Kumar