Periodic fuel price-linked passenger fare hike to continue

Railways today made it clear that it would continue with the fuel adjustment component (FAC) to revise the passenger fares every six months.

After presenting his maiden Rail Budget, Railway Minister Sadananda Gowda told reporters, "We will continue with FAC which was there in 2013-14 also. There will be a periodic hike once in six months. That was taking place earlier also. This will continue."

Faced with major challenges like funds crunch and large number of incomplete projects, he said the government proposed to attract private and foreign investment to tide over the critical financial situation.

Justifying the FDI proposal, Gowda said, "We need huge investment for running bullet trains. There was a ban on FDI on Railways. Now we would request Commerce Ministry to delete that clause so that there can be FDI in infrastructure development."

FDI will not be allowed in core operational areas, he said, adding these areas will remain with the Railways.

On whether there will be any cap on FDI, Gowda said the Cabinet has to take a call and then "we will discuss it with the Prime Minister and Cabinet colleagues before taking a decision".

To a question on public-private partnership, he said the policies have to be changed.

"Private players have no faith... They feel if you invest in Railways there will be no returns.

We will have to change certain policies to attract private players."

Asked whether the government would set up the Rail Tariff Authority (RTA), the minister said, "We are looking at it and studying how it has to be done."

RTA was proposed in the Rail Budget by the erstwhile UPA government.

To a question on the time-frame of bullet train, Gowda said while one survey report has been submitted, another is expected by August end.

"The decision will be taken as soon as it comes," he said.

Trial run is being held for running trains at 160 km speed on Delhi-Agra route while Diamond Quadrilateral network of high speed trains is being considered for major Metros and growth centres.

Observing that financial management was an important area, he said surplus funds of railway PSUs including Rs 4000 crore of Ircon will be invested on various infrastructure projects.

Highlighting the major challenges faced by Railways, Gowda said ongoing projects were starved of funds and funding position was very bad due to which works have not been completed. In the last decade out of 99 works only 10 have been completed while in the last three decades, only 317 out of 674 projects sanctioned were completed.

Referring to the budget, the Railway Minister said while the allocation on cleanliness has been increased by 40 per cent, funds for passenger amenities have been hiked by 25 per cent.

He said latest technology was being utilised for bringing transparency on ticketing while major steps are being taken to improve catering service.

He also said Wi-Fi facility would be provided at A and A1 stations while mobile-based services will be enhanced for wake-up calls and station alerts for passengers.

Gowda said the focus has been given on religious tourism by connecting major pilgrim centres by train as also on adding capacity for faster movement of agro products and milk.

Emphasising on transparency, he said e-governance system will be introduced in Railways. "While procurement of over Rs 25 lakh will come under e-procurement system, all land records would be digitised."

On the involvement of private players in development of world class stations, Gowda said, "We want to have discussion with private players then only we will decide the future course of action."