If this Railway Budget is not to end as another routine annual exercise, Suresh Prabhu has to infuse a dose of vitality missing since decades; the quality was last see when Madhavrao Scindia was the Railways Minister
It is not generally the case that the country’s Railway Budget is awaited with great anticipation. One reason is that, on most occasions, there is nothing new that people expect. They get the usual sops of more trains and lower fares, almost as if by entitlement. And, because these are packaged with further tantalising promises which are never honoured for want of both money and political determination, there has developed a sense of reconciliation with the sorry state of affairs. It’s as if the people have come to accept that Indian Railways will never improve (kabhi nahin sudherega). The other reason for the fatalism is that the Union Budget, which comes within hours of the Railway Budget, tends to overshadow the latter by its broader flourish and larger impact on the country’s economic scenario. The ‘real thing’, therefore, pushes aside the ‘side show’.
But there is a certain buzz around this year’s Railway Budget which Mr Suresh Prabhu is to present in Parliament on February 26. There are two primary reasons for this. The first is Prime Minister Narendra Modi’s repeated emphasis on drastically overhauling the functioning of Indian Railways. And the second is the Railway Minister’s string of bold initiatives taken in the three months he has been at Rail Bhavan to do a complete makeover of the Government behemoth — which is the country’s single-largest public sector employer and an extremely critical component in India’s economic revival. In other words, what is driving the interest among the people and the experts is the Modi-Prabhu concoction. Thus, one thing is sure for this February: Mr Prabhu will be heard with as much interest as Mr Arun Jaitley, the Union Minister for Finance.
If this Railway Budget is not to end as another routine annual exercise, Mr Prabhu has to infuse a dose of vitality that has been missing since decades in the document; the quality was last see when Madhavrao Scindia was the Railways Minister. Simply put, Indian Railways has to meet the aspirations of two kinds of end-users: The passenger segment and the freight segment. The latter has traditionally been used to cross-subsidise the first in the hope that both will then flourish. But neither has. The money earned through freight traffic got diverted to meet the shortfalls in passenger revenue, and thus the development of freight traffic infrastructure suffered. On the other hand, although passenger fares were kept low through cross-subsidies, there was never enough money left after this financial jugglery to pump into enhancing passenger amenities —even the basic ones.
There is just one word that describes the situation in Indian Railways for the last many decades: Unprofessional. If another, less sterilised, term can be allowed, it is: Messy. Mr Prabhu readily accepts the malaise, and also admits that the treatment will be a long process. Of course, there have to be immediate and short-term surface improvements visible along the way, but it would be a mistake to take them as definitive cures. The Railway Budget later this month will be a good indication if the walk along that path of cure has begun in the right earnest.
Everything — from planning to implementation — hinges on the availability of funds in the near and long term. This is what is occupying much of Mr Prabhu’s time. The sheer weight of daunting statistics is terrifying. Consider the following: According to some experts and commentators, Indian Railways needs an investment of roughly $340 billion by 2020 to keep projects going and reforms moving; it has added just around 11,000 kilometres of track in 67 years of independence (China by contrast added 14,000 kilometres between 2006 and 2011 alone); revenues have grown at a mere 2.8 per cent compounded annual growth rate while cost have risen sharply by close to 11 per cent compounded annual growth rate; more than 60 per cent of modernisation and capacity-building projects announced or in various stages of implementation over the years, are financially non-viable. And these are only some of the figures that tell a story of neglect and policy paralysis Indian Railways has suffered from.
While the old baggage has to be addressed, Mr Prabhu has to also plan for and execute the new projects of the Narendra Modi Government: High speed trains and bullet trains, and world-class railway stations. It can be argued that funds will not be a constraining factor here, since quite a few countries have demonstrated a desire and commitment to partner in these projects. But an over-emphasis on them will not go down well with the people if there is no simultaneous enhancement in passenger experience on the existing tracks and railway stations. The vast majority of Indian commuter travels in ‘normal’ trains and uses ‘normal’ platforms, and has been taken for a ride with being given sub-normal facilities, both on the platform and in the carriages. If they routinely arrive late; continue to stink; the food served on board remains non-edible; the linen supplied is dirty; and thieves and pick-pockets have a field day as before, then the resentment against fancy trains will grow and be used a fodder by the opposition parties to demonstrate the Government’s ‘callousness’ towards the common man.
Meanwhile, structural changes must begin to happen. (These changes will impact everything that the common rail passenger encounters). The Government is actively considering a restructuring of the Railway Board, and Mr Prabhu’s arrival at the Rail Bhavan has expedited the process. The Bibek Debroy panel, which is still engaged in exploring various reform measures, has given deep thought to the issue. Earlier, the Anil Kakodkar committee had suggested a revamp so that the archaic divisions with the Board along departmental lines (engineering, finance, electrical, mechanical and traffic) can be done away with. The panel had reportedly opined that these outlines had resulted in turf wars on clearances etc, delaying projects.
The very fundamental role of the Railway Board is also under scrutiny. The Board is both the policymaker and the operator. In other words, since operations are day-to-day affairs and policies are crafted for medium and long terms, the Board has ended up burdening itself so much that neither of the two functions has effectively worked. The demand for a separation of the department of operations from that of decision-making is a sound one. Over-centralisation of powers may have worked to the advantage of the rail bureaucracy, but it has hit efficiency.
The babus can be trusted to oppose this tooth and nail. But with a determined Minister at the helm, they may fail. A senior official in Rail Bhavan remarked, “You need a strong Minister to counter this steel frame (of bureaucracy).”