North Block for private trains

Calling for the gradual dilution of the monopolistic character of the railways through the entry of more private players, the finance ministry has said "willing and able" entrepreneurs must be encouraged to start short-haul freight and passenger trains. Private companies have already been allowed to run container trains.

North Block has suggested a detailed roadmap for greater commercial operations in the railways. These measures include greater emphasis on "outsourcing" or "privatising" services such as ticketing, catering, maintenance and construction of coaches to gradually reduce the obligations of the railways.

In its comments on various issues on the final draft paper to the Eleventh Five-Year Plan, the finance ministry has also supported the proposal to set up a rail tariff regulatory authority.

"The proposal is welcome," it said. It has also pitched for ushering in the concept of cost-sharing with state governments for new lines and putting an end to the practice of using gross budgetary support for replacement and renewal work, and bringing the budgetary support down to 25 per cent of the total Railways Plan, as in the Ninth Plan.

Another proposal is to have separate parameters to assess the railways' performance on two fronts: for revenue, profit, return on capital employed for assessing the performance of commercial projects, and in operational parameters such as improvement in connectivity and punctuality and increase in traffic for social objectives.

Appreciating the private-public-partnership in container movement, the finance ministry has said state governments sharing the cost for new lines with private players would ensure that social obligations were shared among the major stakeholders.

The railways' use of gross budgetary support for replacement and renewal work nearly doubled in the Tenth Plan.