Right priority on safety

Having led a colourful past in which the Indian Railways (IR) was presenting its budget every year since Independence, the Modi Government in its characteristic Schumpeterian creative destruction ended this practice this year by subsuming it in the General Budget. While nobody was bemoaning the loss of this practice, leave aside the army of employees of the IR, one expected some soothing steps to prepare the dedicated staff to this wrenching change by some grandstanding gestures on the part of the Centre to rev up the system.

But in a monotonously long and meandering speech delivered by the Union Finance Minister Arun Jaitley that ran into 55 pages with all its political overtones, proposals about the railway ministry were restricted to less than two pages! Whether or not the railway staff or real-time rail users were happy by this perfunctory approach to the nation's arterial mode of transport that crisscross the country carrying lakhs of passengers and millions of tonnes of freight day in and day out, the Finance Minister said that he felt "privileged to present the first combined Budget of Independent India that includes the Railways also".

The salient points flagged off in the rail component of the General Budget include among others, a provision of Rs 1.31 lakh crore of capital and development expenditure including the Centre's gross budgetary support (GBS) of Rs 55,000 crore for 2017-18, enhanced focus on passenger safety, cleanliness, finance and accounting reforms, a Rashtriya Rail Sanraksha Kosh or special safety fund with a corpus of one lakh crores of rupees spread over a five-year, enhancing the throughput by 10 per cent in the next three years and commissioning of 3,500 km of new railway lines, against 2800 km's in 2016-17. Besides, a start has been made to station redevelopment with at least 25 stations getting the nod, while 500 stations would be made differently-abled people friendly by providing lifts and escalators. Providentially, the temptation to unveil new trains or new routes was wisely resisted this time!

For passenger amenities, the focus is on a swacch rail by introducing "Coach Mitra" facility to register all coach-related complaints and requirements with the promise that all coaches of IR would be fitted with bio-toilets. It is altogether a jolting ground reality that even in prestigious trains like Tamil Nadu Express, the passenger amenities in the air-conditioned coach travellers are none too gratifying with water in the toilets running short to make passengers squirm! One can see all sorts of vendors from major junctions boarding and de-boarding in the running trains in between stations with or without the connivance of the railway staff! The quality of dishes served or sold within the train leaves a lot to be desired, while regular tea/coffee is too sugary to make the diabetic traveller quiver and shudder. It is time the railway authorities made a thorough introspection and put an end to all these pinpricks so that the cross-country journey of close to two days linking Delhi with any major city down South is passable.

The grand claim by the Finance Minister that the railways would implement end-to-end integrated transport solutions for select commodities through a partnership with logistics players with customised rolling stocks and practices to transport perishable goods, especially agricultural products is now passé. One has heard this for many years from successive rail ministers, and no worthwhile start has been made till now. About accounting reforms mentioned by various expert committees including the Debroy Committee, the assurance that accrual based financial statement would be rolled out by March 2019, deferring it for a couple of years even from now!

Interestingly, the Finance Minister has indicated that to improve the operating ratio of the railways continuously, the tariffs of railways would be fixed, taking into consideration costs, quality of service, social obligation and competition from other forms of transport. Now that there is no separate Rail Budget to demand roll-back of passenger fare or freight rate hike in Parliament, the executives in their gut sense can go about adjusting prices of their services as and when the situation demands, making the already uncompetitive freight movement a nightmare for rail users from industry. It needs to be noted that railway revenues are primarily earned through the twin streams, passenger and freight, while some earnings do accrue by luggage/parcels, commercial utilisation of land, siding charges, advertisement and dividend disbursed by Railways' PSUs under two categories called "other coaching and sundries". The earnings are utilised to meet the operating expenses called in technical parlance the Ordinary Working Expenses (OWE), Depreciation and Pensionary charges. The remaining surplus(partly used to pay dividend earlier which stands liquidated with the merger of the rail budget to the general budget) would, one legitimately surmise, be entirely redeployed as plan investment for meeting safety and development needs of the railways.

But the operating ratio, having improved in 2012-13 and 2015-16 to 90.2 per cent and 90.5 per cent respectively, worsened in the current fiscal as the revised figure is pegged at 94.6 per cent. To put it simply, to earn one rupee, the railways spend as much 95 paise, and it is like a besieged person seeking to know his fortune by spending a fortune!

While the budgetary provisions for Depreciation Reservation Fund (DRF) has been inching up over the past few years to take adequate care of the rolling stocks to keep them spic and span to run on the track sans hitches, there is a grouse that the system does not provide sufficiently for budgeted sums but diverts this fund to dress up the operating ratio. If the DRF is slashed or diverted, the resultant casualty in the form of frequent accidents endangering the travelling public is ineluctable but deplorable. DRFs are used primarily for the maintenance of assets, tracks, bridges, wheels, coaches and wagons. A serious thought ought to be given not to tamper with the DRF. To make up the shortfall in revenue to fund operating expenses, unconventional means of marketing and using the immovable assets vested with the system in a productive fashion to rake in resources should be explored.