Industry chambers yesterday welcomed the Railway Budget saying it would give a much needed filip to the economy.
The Confederation of Indian Industry (CII) said the proposals will spur economic activity and stimulate demand.
It said the increased outlay, hike in outlay on new lines from Rs 370 crore to Rs 500 crore, doubling of tracks, increase in traffic facilities and a 50 per cent increase in items like track renewal, electrification, gauge conversion were commendable steps.
More From This Section
Ficci vice-president Sudhir Jalan said the move to maintain railway freight rates was a step in the right direction as it signalled the government's efforts to end subsidisation of passenger traffic through freight earnings.
Assocham president L Lakhsman welcomed the taper of rates for coal, cement, iron or steel and said this would reduce freight rates by about 1-2 per cent for long distance traffic.
He wanted the government to formulate a comprehensive national transport policy to enable specific sectors to put in place future plans. He hoped that the 1998-99 revenue earning traffic target of 450 million tonnes would be achieved.
Lakhsman appreciated the issues raised by the railway minister with regard to declining budgetary support to railways' development plans, shortfall in railway share in the total freight traffic and difficulties in generating internal revenue. He said a lot of these problems could be overcome by evolving new financing instruments, improving efficiency and by corporatising and finally privatising a number of functions carried out by railways.