 "Railways on election track")
Railway Minister Pawan Kumar Bansal raised freight tariff by almost 6 per cent, further undermining its competitive edge vis-a-vis the roads sector, and refused to raise basic passenger fares because these were increased last month, though he upped reservation charges, supplementary charges for superfast trains and cancellation charges.
Bansal has, thus, relied on the time-tested formula of railway ministers to leave the basic passenger fares untouched and rely on freight to fill their coffers. The plan to de-politicise tariff fixation by entrusting the work to an independent Rail Tariff Authority also has remained in cold storage with Bansal announcing that the proposal is at the “inter-ministerial consulting stage”.
That the railway budget was written with next year’s general elections in view became amply clear when Bansal mentioned that an annual increase of 5-6 per cent over 10 years can provide the Railways additional resources of Rs 100,000 crore but refused to bite the bullet. “If the fares remain at a level far below the cost of operations, the Railways are bound to find it hard to provide safe, clean and comfortable journey to the travelling public,” he said in his speech. Another poll-time giveaway was the promise of “concerted efforts to fill up approximately 152,000 vacancies this year”. This could increase Railways’ headcount of 1.4 million by almost 11 per cent.
Jammu & Kashmir, on a boil ever since Afzal Guru was hanged on February 9, was told that the Udhampur-Srinagar-Baramulla project will be taken up on priority, a survey will be done to link Anantnag and Pahalgam and the minister will pursue for approval a project to connect Bilaspur in Himachal Pradesh to Leh via Manali and another from Jammu to Poonch via Akhnoor.
Rae Bareli, UPA Chairperson Sonia Gandhi’s constituency in Uttar Pradesh, will get a new forged wheel factory. The railway track from Rae Bareli to Amethi, Rahul Gandhi’s constituency, will be doubled, Bansal, the MP from Chandigarh who read out the names of South Indian cities with visible difficulty, said.
As expected, the Opposition slammed the budget for “increasing the burden on the common man”, with the Bharatiya Janata party terming it "pedestrian" and "discriminatory" while the Left said it does not give any hope on Railways' future.
Against the Budget estimate of Rs 10,557 crore for the Railway Development Fund, the revised number was only Rs 9,984 crore and the allocation for the Capital Fund was slashed by 91.5 per cent from the Budget estimate of Rs 5,000 crore to Rs 425 crore. The total shortfall in provisions for depreciation and development outlay was thus a record Rs 7,948 crore.
The weakness in traffic receipts reflected in the operating ratio (working expenses as a ratio of traffic receipts) of the Railways for the year. At 88.8 per cent, it was below 94.9 per cent in 2011-12 but higher than the target of 84.9 per cent. The operating ratio for 2013-14 is projected at 87.8 per cent.
In 2013-14, gross traffic receipts are expected to grow over 14 per cent from 2012-13 to Rs 143,742 crore. In expenditure, the pension liability is budgeted to rise to Rs 22,000 crore. However, for the depreciation fund, Bansal has set aside only Rs 7,500 crore, less than the Rs 9,500 crore first earmarked for 2012-13. As a result, the excess of receipts over expenditure will be Rs 13,146 crore, below the 2012-13 target of Rs 15,557 crore. The money set aside for the Railway Development Fund in 2013-14 is Rs 3,550 crore (2012-13 target: Rs 10,557 crore) and for the Capital Fund is Rs 5,443 (2012-13 target: Rs 5,000 crore). The money left, Rs 4.163 crore, will be transferred to the Railway Liability Reserve Fund.
The dilemma also showed up in Bansal’s scheme to meet the annual Plan outlay of Rs 63,363 crore for 2013-14. Apart from gross budgetary support of Rs 26,000 crore, Railway Safety Fund of Rs 2,000 crore, internal resources of Rs 14,260 crore and market borrowing of Rs 15,103 crore, he has provided for Rs 6,000 crore through public-private partnerships.
Given the track record of such ventures, it isn’t clear how this money will be raised. During the 12th Five-year Plan, the Railways plan to raise Rs 100,000 crore through public-private partnerships. This, Bansal said, was a challenge given the “capital-intensive, long-gestation nature of rail infrastructure projects and the limited success achieved so far”. Incidentally, Bansal announced that the Indian Railways Institute of Financial Management will be set up at Secunderabad.
Bansal said 67 new express trains would be introduced in 2013-14 (75 in 2012-13), 26 new passenger services will be started (21 in 2012-13), run of 57 trains will be extended (39 in 2012-13) and frequency of 24 trains will be increased (23 in 2012-13). The target for new lines in 2012-13 was scaled down from 700 km to 470 km, while that for gauge conversion was cut from 800 km to 575 km, though the target of 700 km for doubling is expected to be marginally exceeded. The targets for new lines, gauge conversion and doubling for 2013-14 have been kept at 500 km, 450 km and 750 km, respectively.