Budget 2018: While the Indian Railways got a three-fold hike in its capex at Rs 1,46,500 crore as compared to 2013-14, the key area of concern remains its deteriorating operating ratio which in the revised estimates for FY18 has been pegged at 96% against the Budget estimates of 94.5%. This means that to earn every Rs 100, railways has to spend Rs 96. However, the Centre seems to be keen to improve the ratio by fixing it at a lower 92.8% for fiscal 2018-19. The other area of concern is that freight earnings are not growing as projected. For instance, freight earnings for FY18 has been revised downward to Rs 1,17,500 crore against BE of Rs 1,18,156 crore. Since the target has been missed despite an incremental loading of 45 MT in the April 17-January 18 duration compared with the year-ago period, it means that railways is not getting high revenue earning freight. The FY19 BE for freight earnings has been pegged at Rs 1,21,950 crore in anticipation of a 51 MT incremental loading compared with the current year.
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The passenger earnings has been budgeted at Rs 52,000 crore in FY19, a marginal increase of 0.1% compared with the current year. The railways expects its gross traffic receipts (GTR) at Rs 200,840 crore for FY19. Safety and upgradation has been the main focus areas with majority of the planned capex of Rs 1,46,500 crore for 2018-19 being dedicated for tracks and other safety-related activities. “A large part of this will be devoted to capacity creation. 18,000 kilometres of doubling, third and fourth line works and 5,000 kilometres of gauge conversion would augment capacity and transform almost the entire network into broad gauge,” said FM Arun Jaitley.
Of the total capex for FY19, the budgetary support is Rs 53,060 crore and the rest will be generated through internal resources and extra budgetary resources.
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Taking into account the Rashtriya Rail Sanraksha Kosh, a total of Rs 68,725 crore for 2017-18 (RE) and Rs 73,065 crore for 2018-19 (BE) will be spent towards activities ensuring passenger safety. Railway minister Piyush Goyal said the carrier will borrow Rs 70,000 crore in 2018-19. Experts believe that the railways is on the same track it lay in 2014. According to Manish Agarwal, partner, PwC, with capex of around Rs 1.5 lakh crore, the current government is on way for its initial target of Rs 8.5 crore in five years. “After providing for infrastructure, the railways is now co-focusing on efficiency and user-experience,” said Agarwal.