Lalu stays on the beaten track

No increase in fares & freight rates, Plan size up 8% to Rs 14,498 cr.

Railway Minister Lalu Prasad yesterday sought to keep the common man happy in his Railway Budget for 2004-05, and nothing more.

In a speech, which lasted almost two hours, Prasad left passenger fares and freight rates untouched, and made only cosmetic changes to the Interim Rail Budget numbers. The Budget showed a surplus of Rs 873 crore for 2004-05, marginally lower than his predecessor Nitish Kumar's Rs 880 crore.

His vote bank focus included a wheel plant at Chhapra in Bihar, four new trains for Bihar, a new tourist special train for the common man called Village-on-Wheels, free tickets for unemployed youth attending interviews for government jobs, 50-75 per cent concessions for widows of defence personnel, haemophiliacs and those escorting deaf and dumb persons.

Despite the Centre's contribution to the Railways Plan remaining the same as in the Interim Budget at Rs 7,020 crore, Prasad managed an 8 per cent higher Plan size of Rs 14,498 crore, partially by resorting to 13 per cent higher market borrowings of Rs 3,400 crore.

The operating ratio, which is the ratio of total working expenses to gross traffic receipts, is also projected to worsen to 92.6 in the current fiscal from 92.1 in 2003-04. In other words, it means that in the current fiscal, the Railways expect to spend Rs 92.6 for every Rs 100 earned, leaving a surplus of Rs 7.4.

Except for the Special Railway Safety Fund for which he has earmarked Rs 2,933 crore, which is 22 per cent more than the previous fiscal, and the pension fund where he has budgeted a nominal higher appropriation of 3 per cent, Prasad has reduced the amounts for the Railways' development and safety funds.

Prasad, however, took credit for keeping the Railways' expenditure under check, despite the Centre's 50 per cent dearness allowance merger with salary and the diesel price increase during the year.

He said stringent expenditure control measures and zero-based budgeting would help the Railways absorb the impact of these measures, and in fact, reduce the working expenses by Rs 100 crore to Rs 32,860 crore.

Despite a 7.45 per cent higher freight loading at 557.39 million tonnes during 2003-04, the minister has budgeted for a modest 4 per cent increase during the current fiscal at 580 million tonnes. Freight earnings for the current fiscal have accordingly been budgeted at Rs 28,745 crore, or 3.8 per cent higher than the actual freight earnings of Rs 27,695 crore in 2003-04.

On the passenger front, Prasad expects earnings to rise only marginally by 3.56 per cent to Rs 13,940 crore from Rs 13,460 crore in the revised estimates of 2003-04. He expects to carry 5.36 billion passengers in the current fiscal, which is just 2.86 per cent, or 149 million, more than the number of passengers carried in 2003-04.

Prasad announced a 10 per cent freight rebate for heavy machinery movement on rail by customers in special wagons owned by them. This, he said, would encourage movement of such consignments for thermal power stations and other industries.

The minister also increased the parcel rate structure by 7-10 per cent under various categories, which is expected to garner an additional revenue of Rs 50 crore. Other coach earnings for 2004-05 are thus estimated to be Rs 1,040 crore, or 12 per cent higher than the previous fiscal.

He also introduced a new Engine-on-Load (EOL) scheme, where the engine would wait for a specified period during the loading and unloading of goods.