Rail Budget 2016: With the finances of Indian Railways looking precarious, Railway Board chairman AK Mittal explains the major thrust areas in the FY17 Budget and why the transporter has not increased passenger or freight tariffs in the new Budget.
Rail Budget 2016: With the finances of Indian Railways looking precarious, Railway Board chairman AK Mittal explains the major thrust areas in the FY17 Budget and why the transporter has not increased passenger or freight tariffs in the new Budget. Excerpts from the interview:
Why have you not increased passenger or freight tariff specially when the peak season for passenger traffic is coming?
I agree that increasing tariff is the easiest way to generate and boost revenue. The major reason why we have not changed the tariff is because we do not want the common man to get affected by the changes in freight or passenger tariffs. We believe that the transporter prospers by first cutting its working expenses. Our focus will be to deploy the latest locomotives which are energy efficient and will help us not only save on our diesel and traction costs but also reduce our carbon footprint. Introducing zero-based budgeting so that we can understand where every rupee is spent and identifying areas where we can reduce our expenditure. The major highlight for this Budget is the focus on non-farebox revenue we are expecting to generate a minimum of Rs 5,000 crore in the initial stages. We have earmarked seven missions for this Budget, which will help the organisation get on track, namely Mission 25 tonne, mission zero accident, train collision avoidance system, mission PACE, mission raftar, mission 100, mission beyond keeping and mission capacity utilisation.
There is some talk about introducing a holding company? Can you elaborate ?
We still have not approached the finance ministry in this regard, but we will do so soon. The broad framework involves developing a holding company which will have and equity share in all our PSUs’. The holding company will be involved in cross functional co-ordination between the transporters public sector units and in effect help in controlling and creating a road map for them. It will also help in generating revenue as it will receive dividends from the public sector units as well as disinvestment can also take place.
What is the status of the Delhi-Mumbai bullet train project ?
We have already registered a company called National High Speed Rail Corporation which will fast track the whole project. The company has a paid up capital of Rs 20,000 crore and Indian Railways has provided for an equity of Rs 200 crore which if needed can be increased. Ministry of Railways will have 50% stake in it while the states of Gujarat and Maharashtra will have 25% each. We will be appointing the directors of the company in the coming three months. Rest assured this project is on priority and we will be trying to complete it as fast as possible.
By A K Mittal, Chairman, Railway Board.