Indian Railways have initiated a Five Year Plan model to turn the sector around, Railways Minister Suresh Prabhu said on Friday.
"The investment cycle for the sector is about three to five years and the ministry intends to synchronise this with the country's Five Year Plans. It is most critical that a proper lifecycle assessment of the projects is done and the correct projects are identified," said Prabhu at the Federation of Indian Chambers of Commerce and Industry's (FICCI) 88th AGM.
"In order to witness a dramatic positive change in the sector, it will be imperative to have a repetition of this investment cycle over the course of at least next three to four five year plans," he said.
Elaborating on plans to address several key issues plaguing the sector, he said the railways have initiated the process of upgrading rail roller shops, improving traffic management, cleanliness, quality of railway platforms and customer satisfaction.
Recently, the ministry submitted a white paper "Challenges of the Railways', to parliament to highlight the difficulties being faced by the sector.
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Prabhu said the his ministry has started work on the 110 actionable points it raised in the last railway budget while work also started on the Rs.40,000 crore locomotive modernisation contracts which were not announced in the budget.
"Work on the railway dedicated freight corridor has also been initiated and contracts are being awarded for this as well," he said.
Other steps taken by the railways included creating a draft regulatory framework for proper fixation of passenger and freight fares and plans to undertake an overall restructuring of railways as an organisation to bring in greater operational efficiency.
Explaining the immediate challenges being faced by the railways, Prabhu said: "Firstly, the significant burden which is expected from the new pay commission going ahead would be the most difficult to handle. Secondly, the revenue from the freight and bulk cargo is going down due to weak demand from the steel and cement sectors."
The cost of energy is the other major challenge as railways is one of the largest consumers of power.
"Indian Railways has undertaken an energy audit and was trying to rationalise energy consumption. Also, usage of solar energy was being encouraged," he said.
