Suresh Prabhu presents a robust Rail Budget
It is difficult to be progressive, much less adventurous, with the Rail Budget, when revenue collection targets become difficult to meet or when freight continues to move away from the railways to the road sector. These problems have been in existence for years, and have gone from bad to worse in the absence of effective fixative mechanisms. They will take time to mend. Even as the Ministry of Railways grapples with them, it has to keep focus on other essentials as well, such as safety, punctuality, cleanliness and quality catering. And then there is the ‘populist' demand from lawmakers for more trains for their constituencies. Given the constraints, Minister for Railways Suresh Prabhu has, in his consecutive second Budget, plumped for pragmatism. It must be said to his credit that he has decided to convert challenges into opportunities, working on the short-term, medium-term and long-term solutions. While in his Budget for 2015-16, he had laid down the roadmap to tackle some of these issues, including raising the massive finances needed to recast the functioning of Indian Railways, in the Budget for 2016-17, which he presented in Parliament on Thursday, Mr Prabhu has stayed on course, while offering fresh hopes and proposals, especially in enhancing passenger experience. This Rail Budget has stressed more than many had expected it to on providing greatly improved services to the millions of commuters across the country without an enhancement in rail fares. For instance, the three new train services which have been announced are not the run-of-the-mill ones that Ministers have in the past foisted on Indian Railways without considering either their viability or the network's capacity to handle them efficiently. One service will be exclusively for long-distance unreserved passengers; the second (a double-decker) for short-travel passengers connecting important commercial destinations; and the third a fast train having only three-tier air-conditioned coaches with modern amenities on board. Mr Prabhu has shown sensitivity in small but significant ways too, such as in proposing an increase by 50 per cent the lower berth quota for senior citizens and 33 per cent reservation to women in reserved quota.
But the most noble of measures can collapse for want for funds. Indian Railways suffered a loss of Rs30,000 crore through cross-subsidy on passenger fares. In addition, there are new factors that will come into play with the Seventh Pay Commission recommendations which will increase the pay and related expenses of the railways. So, the two good ways to manage the finances are: One, optimise benefits through every rupee spent in the hope of generating revenue, and two, rationalise expenses by streamlining functioning and cutting flab. Mr Prabhu had announced in his last Budget ambitious plans to raise revenue, and he has continued in this direction. He now proposes to monetise land along tracks by leasing them out for commercial use and to also monetise the other considerable assets of Indian Railways. Unless he can raise the levels of revenue through the two methods (the expected increase in revenue collection to Rs1,84,820 crore is good but insufficient to realise Mr Prabhu's plans), it will be difficult for him to improve upon the Operating Ratio target, now fixed at 92 per cent.