Nitish keeps his powder dry

INTERIM RAILWAY BUDGET 2004

Railway Minister Nitish Kumar presented an Interim Railway Budget that revealed a none-too-healthy picture with a Rs 890 crore shortfall in gross traffic receipts over the budget estimate for the current fiscal, though the economy is poised to grow by almost 8 per cent.

However, a 3.73 per cent squeeze in total expenditure in the current fiscal over the BE of Rs 40,850 crore helped him post a higher surplus of Rs 880 crore compared with Rs 600 crore in the budget estimate.

There was no increase in passenger fares and freight rates for the next fiscal - as was expected from an interim budget. But the outlook he presented for the next fiscal year was such that the regular budget to be presented later this year would have no option other than mobilising additional revenue through new tariff measures.

The net traffic receipts for 2004-05 are projected to decline by 1.4 per cent to Rs 3,232 crore, as the total working expenses for the next year will grow at a rate higher than the gross traffic receipts.

The minister's gameplan for the current year has been to balance the drop in earnings by cutting operating expenses on rolling stock, fuel and on track renewals, along with a Rs 290 crore lower allocation to the Pension Fund.

While he has increased the allocation to the Depreciation Fund by Rs 262 crore this year compared to BE, he has effected a 16 per cent, or Rs 367 crore, cut in the allocation for the next fiscal.

While he improved the operating ratio (working expenses as percentage of gross traffic receipts) to 92.6 per cent in the RE for 2003-04 from 94.1 per cent in the BE, it is expected to slide to 93 per cent in the next fiscal. But he continued to meet the Railways' dividend liability and made provisions to wipe out the previous years' deferred obligations.

To attract additional freight and passenger traffic to the Railways, he has incentivised frequent travellers on Rajdhani, Shatabdi, and Jan Shatabdi Expresses, and promised to improve the freight classification system for bulk cargo traffic, especially petro goods.

Riding on the election wave, Nitish Kumar has promised to create 300,000 jobs by announcing a huge Rs 20,000 crore project, Remote Area Rail Sampark Yojana, which would clear the entire shelf of 223 pending projects with the Railways.

Kumar chanted the "feel cheerful" mantra on the eve of elections to also announce 17 new superfast Sampark Kranti Expresses to connect every state with a non-stop journey to Delhi.

The minister has projected the gross traffic receipts for 2004-05, based on the existing level of fares and freight at Rs 44,482 crore, which is just Rs 987 crore more than the budget estimates for 2003-04.

The current fiscal is expected to end with a figure of 42,605 crore. The total working expenses for the next fiscal is Rs 41,250 crore compared with Rs 39,327 crore revised estimates for 2003-04. The budget estimate was Rs 40,850 crore.

The budgeted allocation to the Railway Safety Fund in 2004-05 at Rs 401 crore, is also 7 per cent lower than Rs 433 crore allocated in the current fiscal.

The Plan support for the Railways for 2004-05 is again 3.5 per cent less at Rs 13,425 crore, compared with the revised estimates of Rs 13,918 crore for 2003-04.

The minister has received Rs 1,000 crore higher Plan support in the current fiscal--Rs 500 crore for the Udhampur-Srinagar-Baramulla line and another Rs 500 crore for increasing the pace of completion of certain projects.

The Railways have also budgeted for an almost unchanged Rs 3,050 crore by way of market borrowings for the next financial year, which includes Rs 3,000 crore to be raised by Indian Railway Finance Corporation and Rs 50 crore from the Build-Operate-Transfer and Own Your Wagon schemes.

The minister also admitted that there was a sharp drop in the revenue yield per million tonne of freight from the budget estimate of Rs 51.50 crore to Rs 49.55 crore for the first nine months of the current fiscal year.

However, in terms of volume, the Railways expect to end this fiscal with a total freight loading volume 550 million tonnes, 10 million tonnes more than the budget estimate for the year. For 2004-05, Kumar said, he is increasing the target by another 20 million tonnes to 570 million tonnes.

As part of his initiatives to woo upper class passengers, Kumar announced a pilot project enabling those travelling on select Shatabdi Express trains to get reservations through the internet and occupy their reserved seats on the basis of a computer generated slip. He also announced that tickets can be booked on cell phones.

Travellers will be updated on their cell phones if there is a delay in the departure of Rajdhani, Shatabdi and Jan Shatabdi trains by more than 30 minutes, he said. Initially, this facility will be made available as a pilot project for such trains departing from Delhi.

The Tatkal reservation scheme, available now only in select trains and primarily in the sleeper class for short-notice travellers, will also be extended to all trains in sleeper, chair car, AC 3-tier and 2-tier classes.