Push to railways

The green signal given by the Union cabinet for the setting up of a railway tariff authority will hopefully pave the way for making the railways a more efficient and business-like organisation which will serve the national needs and meet the demands of its users better.

The proposal had been made in the 2012-13 railway budget and the government had wanted it to be constituted through an executive order to be approved later by legislation. But it will function as an ad hoc advisory body till the Railway Act is amended to give it sufficient powers to make recommendations on fare and freight charges.  At present the Act allows only the railway board to do that. The authority is proposed to be a five-member body including its chairman.

The railways badly suffers from lack of investment which is a result of its inability to raise internal resources. Decades of populist policies have landed it in a desperate financial situation and it is surviving only because it is a monopoly organisation supported by tax payers’ money. The prices of its services have not kept pace with the increasing expenditure in terms of expansion, modernisation, provision of amenities to passengers and most importantly ensuring the safety of passengers. Passenger fares are heavily cross-subsidised by freight charges and the resulting high cost of freight movement hurts the economy and even spurs inflation.

The fourth largest rail network in the world is technologically very backward compared to other similar railway networks in the world. It has consistently failed to achieve its own modest infrastructure development targets by big margins. While India added only about 13,000 km of new railway lines in the last seven decades, China laid more lines than that in the last seven years. Indian railways are also among  the most accident-prone rail networks in the world and services need to be improved in every respect.

Various committees which studied the working of the railways have underlined the need to make large investments to improve its finances, facilities and services. One major source of funding is rationalisation of tariffs and the proposed authority should have the power to do this. It will not help if it remains an advisory or recommendatory body. Necessary legislative changes should be made to make its recommendations binding on the government. An efficient  and self-sustaining railways will only be welcomed by the passengers and will give a major boost to the national economy.

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