UPA set to push non-lapsable rly safety fund

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Ashish Sinha, Rajat Arora: New Delhi, Nov 16 2012, 02:04 IST

The UPA government is all set to push for the reintroduction of a non-lapsable railway safety fund (RSF) pegged at Rs 66,000 crore, the largest safety fund in the history of Indian railways. The previous RSF with a corpus of R17,000 crore was started by the NDA government in 2002-03 by the then railway minister Nitish Kumar which lapsed on April 1, 2008.

The proposed RSF will go towards the renewal of over-aged assets of track, bridges, signalling gear and rolling stock within a fixed time frame of 5-6 years.

To raise the required money for the proposed RSF, the railways is mulling over several options including raising money through railway bonds and levying safety cess on passenger tickets as suggested by former rail minister Dinesh Trivedi. Sources said the rail ministry may rope in the financing arm of Indian railways — Indian Railway Finance Corporation (IRFC). “The option is to allow IRFC to come out with a bond issue. Around R10,000 crore could easily be raised through IRFC,” said a railway officer.

Other options before the railway ministry include commitment of dividend-free grant by the finance ministry (around R20-24,000 crore spread over the next 5-6 years) and a contribution from the Central Road Fund (R5,000-6,000 crore). The rail ministry will also contribute from the ‘Railway Safety Works Fund’ (maintained by the finance ministry), out of the dividend payable to general revenues. The ministry is also in favour of imposing a small safety cess (between R5 to R10) on railway tickets to generate

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