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The Narendra Modi-led government’s “bitter pill” of rail fare hike was on Tuesday sweetened with a rollback for the second-class suburban segment up to 80 km. Also, fare hike for the monthly season pass for both suburban and non-suburban has been capped at 14.2 per cent. The hike will be effective from June 28.
About 94 per cent of suburban commuters travel by the second class. Of the total 7.5 million people who travel every day by Mumbai suburban rail, about 5.5 million avail monthly season tickets.
According to the June 20 order, a monthly season pass holder would have to pay for 30 journeys instead of the 15-17 journeys he was paying earlier. The new order brings some respite for the daily commuters with the fare hike capped to 14.2 per cent of the earlier fares. This means, after the rollback, a monthly pass for a single journey up to 65 km would cost only Rs 270 against Rs 450 earlier.
While the Railways had expected to generate about Rs 900 crore extra through the change in monthly season ticket rules, after the rollback it would take a hit of about Rs 550 crore. However, it could still end up making about Rs 350 crore extra, as over 70 per cent of the commuters avail monthly season passes and will fall in the purview of the fare hike of 14.2 per cent, which is inclusive of fuel adjustment component.
However, there is no rollback on non-sub-urban passenger and freight fare hike. During the previous fare hike in October 2013 too, the Railways did not increase fares of suburban trains. This was last done in January 2013 by two paise a km.
The rollback decision will add to the Railways’ losses and the pressure of the subsidy will continue to rise with increasing fuel costs. Suburban operations account for 53 per cent of the Railways total passenger volume. The Railways spends 30 paise for every km of the suburban rail network, earning 14 paise. Experts claim out of the total losses for the passenger segment, which stood at about Rs 26,000 crore in 2013-14, over 50 per cent can be attributed to the loss-making suburban operations.
Former Financial Commissioner of the Railways Sivadasan said the disproportionate earnings/expenditure ratio was common for most suburban railway systems globally. “But most of them make up for it through other sources; raising non-fare box revenues is one of the ways, but one also has to provide quality services.”
Unlike the non-suburban side, which has been registering declining volume, traffic in the suburban segment increased 1.7 per cent last year.
FINANCIAL PINCH
- Suburban passenger operations account for 53% of passenger volumes but contribute only 6-7% to revenue
- Number of suburban passengers for 2013-14 stood at 4,549.85 million– growth of about 1.7% over last year
- Of the total loss in passenger segment, which stood at Rs 26,000 crore last year, suburban operations accounted for more than 50%
- The last fare hike for suburban operations was in January 2013, by 0.2 paisa a km
