Having hiked fares to the tune of 14.2 per cent recently, Railway Minister Sadananda Gowda who presented the new government's first budget in Lok Sabha said he plans to leverage railway PSU resources by bringing in their investible funds in infrastructure projects.
He announced plans to introduce a bullet train in Mumbai- Ahmedabad sector and setting up of a Diamond Quadrilateral network of high speed rail connecting major metros and growth centres. A sum of Rs 100 crore has been provided for initiating the project.
Increasing the speed of trains to 160 to 200 kms per hour on nine select sectors was another highlight of the budget, which proposes to allow all experimental stoppages to lapse after September this year.
The Budget disclosed that traffic growth declined and expenditures went up in 2013-14 as compared to the revised estimates of previous financial year.
Gross traffic receipts stood at Rs 1,39,558 crore, short of revised estimates by Rs 942 crore over the previous year. The ordinary working expenses and pension outgo were also higher.
The budget estimates for 2014-15 assumes a freight loading 1101 metric tonnes, 51 metric tonnes more than the previous year, growth in passenger traffic at 2 per cent and freight earnings at Rs 1,05,770 crore.
Passenger earnings will be Rs 44,645 crore after a revenue sacrifice of Rs 610 crore on account of monthly season ticket fares.
Total receipts for the current year have been pegged at Rs 1,64,374 crore and expenditure at Rs 1,49,176 crore.
Disclosing that he needs more than Rs nine lakh crore to completing the Golden Quadrilateral Network and Rs 60,000 crore for introducing one bullet train alone, Gowda told the House, "Can I depend only on hiking fare and freight rates and burden the public to realise these funds This is unrealistic. I need to explore the alternate means of resource mobilisation."
He proposed to launch a scheme to bring in investible surplus funds of railway PSUs in infrastructure projects which can generate attractive returns.
Proposing private investment in railways through domestic and FDI, Gowda said growth depends heavily on availability of funds for investment in rail infrastructure.
Internal revenue sources and government funding are insufficient to meet the requirement, the Railway Minister said, adding the ministry is seeking Cabinet approval for allowing FDI in rail sector.
FDI, however, will be limited to infrastructure development and not allowed in operations, he said.
He said the concept of PPP has not been successful in raising substantial resources for railways. "It is my endeavour to pursue this in right earnest. It is our target that bulk of our future projects will be financed through PPP mode, including the high-speed rail, which requires huge investments."
Apart from mobilising resources, Gowda said he needed to strategically manage other aspects of planning and administration by adopting a near-holiday approach, setting timelines for ongoing projects, strategic partnership and aggressive indigenisation of imported projects.