The government has agreed to enhance the railways plan size for 1997-98 from the budgeted Rs 8,300 crore to Rs 8,470 crore. It has also agreed to increase the budgetary support to the railways for the current year from Rs 1,831 crore to Rs 2,001 crore to make up for the Rs 170 crore increase.
Railway Board chairman M Ravindra said this had been indicated to him at the highest level, implying that the increase in the plan size and budgetary support could be considered final, with only the official communication yet to come.
The increase means the railways will be able to take up more development projects than envisaged in the 1997-98 budget. Sources said the additional plan money was likely to be spent on laying new tracks and gauge conversion projects mainly in backward areas. The names of new projects to be taken up with the outlay increase will be known after they are finalised.
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The 1997-98, there was only a marginal increase in the plan outlay which went up from Rs 8,130 crore in 1996-97 to Rs 8,300 crore for the current year.
The railways is still pressuring the finance ministry and the Prime Ministers Office for a further increase in budgetary support on the ground that even with the enhanced Rs 2,001 crore, it will be difficult to mobilise enough resources to fund the enhanced plan size.
Sources say the Planning Commission has recommended an increase of Rs 300-400 crore in the budgetary support of Rs 1,831 crore extended to the railways.
The ninth plan size of the railways is still under discussion. The railways has asked for a size of Rs 65,000 crore, but indications are that the Planning Commission and the government would allow a much smaller size.
Although the railways is asking for the maximum amount possible against its demand of Rs 65,000 crore, the Railway Board chairman said it would be impossible for them to make do with a plan size smaller than Rs 50,000 crore.