Railway Budget
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A few positives, but much still to be done

 The Railway Budget has taken some welcome steps, but it stops short of taking significant steps to make rail travel safe. The
accidents have shown no signs of abating and there’s a disturbing trend to pass State riches into private hands

The Railway Budget for 2008-09 has some positive features. The reduction in passenger fares is a welcome step. In times when people are suffering from all-round price rise the reduction in passenger fares provides some relief. However, the reduction in second class fares up to Rs 50 by Re 1 can only be termed tokenism. Freight rates for petrol and diesel have been reduced by around 5 per cent, which is a good step. The appointment of licensed porters as gangmen and other Group D posts announced in the Railway Budget too is a positive step. But more initiatives should have been taken to fill up the over 1.5 lakh vacancies in Railways, and also absorb contract workers working in various projects.

The number of new trains announced this time is more than last year's but the number of route extensions is less. However, some states have been ignored, especially North Eastern States and Jammu & Kashmir, which is bound to give rise to discontent. The targets set for 2008-09 for new lines (350 kms), gauge conversion (2150 kms), doubling (1000 kms) and electrification (no target announced) are too low given the substantial financial resources available and reflects the continuing delay in project planning and implementation. The outlays and targets set for enhancing safety and security in Railways have not matched the claims made in the railway minister's speech. There is no room for complacency on this count given the high number of railway accidents and acts of terrorism. The enhanced production targets for locos and wagons are welcome, but purchase orders for these have to be evenly distributed among the public sector wagon and loco manufacturing units in different states.

The Budget envisages future expansion of container trains and depots mainly in the private sector, with the number of private container trains increasing from 46 to 50-55 and 40 new privately controlled container depots to be built in the coming year. The increase in public investment in container trains and depots is insignificant. Clearly, the approach is to hand over the profitable container business to the private corporate sector. A proposal also has been made to hand over major railway stations in New Delhi, Mumbai, Patna and Secunderabad to private players for development. Private players are also to be involved in setting up diesel and electric locomotive and coach factories. The CPI (M) is opposed to these privatisation measures announced in the Railway Budget and demands that they be not taken forward.

  

Lalu fudges figures for Railways’ shine

There is also an attempt to conceal figures. After presentation of the 2007-08 budget, without approval of Parliament, ticket cancellation and return ticket booking charges were unilaterally increased
three-fold.

Railway Minister Lalu Prasad Yadav says that he has done an “indrajal”— magic with the Railway Budget and shown a “profit” of Rs 25,000 crore even after giving slew of “concessions”. Unfortunately, the media was carried away by his rhetoric without caring to go into the details. Lalu has given no concession, neither has he made any cut in freight fares at any level. Sadly, the media — except for one or two TV channels and newspapers— gulped whatever the “magician” tried to show.

Lalu announced Rs 21,578 crore as surplus in his 2007-08 budget. The reality is that “the excess for 2006-07 amounts to less than half of Rs 10,206 crore” as given in the detailed Explanatory Memorandum of the Budget. Accordingly, there is Rs 416 crore reduced net
revenue last year. The budget speech is silent on this non- performance. This calls for serious introspection.

It is unlikely that Railways would have a surplus of Rs 25,000 crore in 2008-09 either. It may even be less than the actual figures of 2007-08. What has Lalu given to the passengers? Precious little. Even 4 per cent cut on sleeper class fare and 8 per cent in AC-3 tier and chair car fare announced in the last year’s budget has not been passed on to the passengers. There was a clause that it would be effected after the introduction of new LHB coaches. Since not many new sleeper coaches were added, Chairman Railway Board K C Jena announced soon after presentation of the new budget, the benefit could not be given.

Lalu’s announcement this year of 7 per cent cut on AC-I fare and 4 per cent on AC-2 tier fare are unlikely to benefit the people. The rider, Lalu says, is: “This reduction will be only 50 per cent for popular trains and during lean period”. What is the lean season? The Chairman says it means the period between February 1 and March 31 and August 1 and August 31. The rest — nine months — is peak season. So Lalu earns the kudos without having to give anything.
What is a popular train? Chairman says it is being worked out but indicated that majority of the trains are in that category. The jugglery in figures become acute as one reads through them. His surpluses include Rs 1,250 crore on account of anticipated 6th Pay Commission recommendations— Rs 750 crore in ordinary working expenses and Rs 50 crore in pension fund. It also includes a deferred dividend liability of Rs 664 crore. But he conceals that his liability on provident fund, retirement benefits and pension has gone up by Rs 500 crore — from
Rs 9,706 crore in budget estimates to Rs 1,482 crore. It has increased by Rs 428 crore on staff amenities. There has been Rs 598 crore increase in maintenance of plant equipment cost, Rs 657 crore on rolling stock and equipment. On several other heads too similar increases have been indicated. This only reveals that claims in the Budget speech are different from the reality.
There is also an attempt at concealment of figures. After presentation of the 2007-08 Budget, without approval of Parliament, ticket cancellation and return ticket booking charges were unilaterally increased three-fold. Tatkal tickets, which were only 10 per cent of the total seats, were increased to 30 per cent. The Budget does not reveal the additional earning on this count. When asked for details, the Chairman said he did not have figures with him and it had to be worked out.

The railway minister appeared very generous in announcing 6 per cent cut in freight rates for goods headed to North-East. But he concealed that one travelling to North-East has to shell out more. For example, a person travelling from Mumbai to Guwahati could earlier buy a Mumbai-Howrah-Guwahati ticket for Rs 557. Now, he has to buy a Mumbai-Howrah ticket for Rs 517 and another ticket for Howrah-Guwahati for Rs 369. It is estimated that Railways is earning Rs 100 crore at least on this count. And all this has been done without any sanction of Parliament.

So there is no “indrajal” in Lalu’s budget. It tries to create an illusion and conceal from the people and its supreme body — Parliament — the reality.