Indian Railways is actively pushing the new model to "outsource" the operating and running of regular passenger trains to the Indian Railway Catering and Tourism Corporation (IRCTC).
Indian Railways bets on IRCTC’s corporate trains! The country’s third “corporate” train- Kashi Mahakal Express was recently flagged off after the two private Tejas Express trains between Ahmedabad- Mumbai and Lucknow- Delhi were introduced. Piyush Goyal-led Indian Railways is actively pushing the new model to “outsource” the operating and running of regular passenger trains to the Indian Railway Catering and Tourism Corporation (IRCTC), a PSU under the Railway Ministry, according to an IE report. The ministry also wants to lease out as many as 100 routes to private entities to run 150 trains. Here are some key things to know about the new Indian Railways private model:
1. All the decisions of running the service including food, fare, onboard facilities, housekeeping, complaints, etc., are taken by the corporation. The national transporter is free from these encumbrances and gets to earn a pre-decided amount from IRCTC. The amount comprises three components- lease, haulage, and custody. The amount is payable even if the occupancy of the train is below expectations and is not doing good business.
2. According to the report, IRCTC insists that the coaches it receives from Indian Railways are new and not in a run-down condition, as the quality of the coaches has a direct bearing on its business. In the corporate train model, IRCTC has full flexibility to decide the service parameters. Also, the corporation has the rights to alter the parameters without going to the Railway Ministry.
3. Depending on the needs of its business model, IRCTC gets to decide the number of stoppages it wants to afford on a route. For instance, the Lucknow-Delhi Tejas Express has two stops, whereas Mumbai-Ahmedabad Tejas Express has six stops.
4. For Indian Railways, the good thing is that it doesn’t have to suffer the losses that are associated with operating these trains. This is because there is less chance of under-recovery of cost due to low fares as well as hefty overheads.
5. The model under which operators of private trains on Indian Railways network are sought to be engaged is different wherein along with Rs 668 per km haulage, the operator needs to agree with the national transporter on revenue sharing. The firm that is willing to share the highest revenue percentage will win the contract. Also, lease and custody charges may not be needed to be paid by private players as it is expected that they will bring in their own rolling stock.