Finally, rail fares hiked modestly after a decade
Bansal announced the hikes in the range of 2-6 paise per kilometre at a press conference — there is no precedent of the passenger fare being hiked between two annual railway budgets even though freight rates get revised more frequently — and justified this break from tradition, saying: “If we waited for another two months (for the presentation of the railway budget), our fiscal crisis would have worsened.”
Terming the new fares “reasonable”, the minister said the losses in the passenger segment,which stood at R1,059 crore in 2004-05, rose to R19,964 crore in 2010-11, an increase of 18% annually. The losses are likely to go up to R25,000 crore in the current fiscal.
Thanks to the refusal of successive railway ministers to hike passenger fares, the national transporter’s financial health has deteriorated — it needs to spend 95 paise to earn a rupee now, a situation that left it with little surplus for investment. This is at a time the railways needs huge funds for expansion and modernisation. The Sam Pitroda and Anil Kakodkar panels had estimated that the world’s third largest rail network will need a cumulative investment of Rs 9 lakh crore over five years for its network expansion,
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