Railway Budget 2016: On track to appease all
Union Railway Minister Suresh Prabhu takes a long-term view but without hike in fares, can he rake in the moolah?
Union Railway Minister Suresh Prabhu’s second Railway Budget remained passenger-focused and caused no heartburn to the ‘aam aadmi’.
Passenger fares were left unchanged while the super-fast Antyodaya Express for long routes and Deen Dayalu coaches for some long distance trains brought good cheer for the poor.
As Prabhu tabled the Railway Budget in the Parliament on Thursday, his thrust was towards greater investment, restructuring of the Railway Board, and setting up of cross-functional directorates with the board in order to resuscitate Indian Railways. His view in the Budget was laudably long-term but with no hike in fares, execution of this Budget surfaced as key.
The passenger was king with Prabhu announcing a slew of measures to improve passenger experience.
Railway Budget 2016: Highlights
From 400 wifi-enabled railway stations and 17000 bio-toilets to increase in lower berth quota for senior citizens by 50 percent, Prabhu’s announcements had something for everyone. “Railway Budget delineates a bold vision and foresight with a strong focus on investment, job creation, safety and security which would help to move our growth closer to our latent potential,” Sumit Mazumder, president, CII said.
Prabhu’s Budget concentrated on greater consolidation and efficiency in the functioning of the Railways rather only on expansion of network. Proposals for three freight corridors, two locomotive factories with total investment of Rs 40,000 crore to boost Make in India, 44 new partnership projects covering 5,300 km valued at Rs 92,714 crore were also announced.
“The budget has focused on key issues plaguing the railways which are customer experience, increasing efficiency, network decongestion, improving safety, improving stations, increasing revenues andavailability,” said Jaijit Bhattacharya, Partner – Infrastructure and Government Services, KPMG in India.
The Railway Budget also laid the groundwork for future projects such as high-speed railway or bullet trains. Interestingly, the Minister also spoke of fresh ways of funding railway projects through multilateral assistance, setting up of a new fund and tapping the Rupee bond market overseas. LIC is also expected to chip in with Rs 1.5 lakh crore over the next five years.
Garnering capital will be crucial because along with status quo tariffs, there is also the additional spending burden piled onto the Railways due to the 7th Pay Commission. The Railway Minister has made a planned allocation of Rs 1.21 lakh crore while keeping 10 percent growth projections on revenue targets of Rs 1,84,820 crore. “The project implementation would remain a key. The best thing is that he is willing to challenge the age-old notion as if it is only through tariff hike that the organisation as important as the Railways can be turned around. Efficiency and out-of-box approach can work, and he is depending on the same,” said Sunil Kanoria, president, ASSOCHAM said.
