Railway Budget 2017 will for the first time be a part of the main Union Budget as the Narendra Modi government does away with the practise of presenting a separate one. This is the first time in the history of Independent India that the Railway Budget will be a part of the main Budget. Finance Minister Arun Jaitley will read out his share of allocation for Indian Railways, a crucial amount that will determine how much Railway Minister Suresh Prabhu gets in his kitty to spend on one of the biggest drivers of the Indian economy.
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Like every year, this year too the expectations are high on what will be announced, but let’s get one thing out of the way – it won’t be a regular Railway Budget – that’s the whole idea of merging the two financial statements. New trains are unlikely to be announced. For the Finance Minister, Railways will be just another sector that needs money to propel growth. We take a look at some key areas that Railway Budget 2017, as part of Union Budget 2017, may focus on:
Fare hike in the offing? FM Arun Jaitley has hinted that there is a possible fare hike for Railways. Railways increasingly wants to move to a market-oriented model, implying that for all the increased services and comforts that it provides – passengers will have to pay more.
Safety tax: One of the very likely ways in which the price of a AC-3 tier or 2-tier travel will go up in the coming fiscal would be with the implementation of a safety tax. The buzz is that FM Jaitley wants to collect money as part of the Rashtriya Rail Sanraksha Kosh. This will be a railway safety body, that will work to reduce accidents. This comes in the light of back-to-back train derailments that claimed many lives.
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Reduction in freight rates: There are also plans to reduce charges on freight, which holds the largest portion of rail revenue. The idea has been introduced to prevent the clients to move to other modes of transport.
Budgetary support: It is also believed that, in order to meet part of its capital expenditure, Railways may also get budget support, and may also be allowed to raise extra budgetary sources.
Private participation: An ET Now report suggests that the Narendra Modi government is looking at a proposal to allow private players to run rail network on the lines of the airport leasing model. The government weighing the proposal that will allow private operators to run trains using government tracks and stations. According to the channel, the government is keen to allow private players in core rail activities. The move to consider such a step comes in the backdrop of the fact that freight traffic is down and cannot be relied on anymore to subsidise passenger fares, the channel reported.