Merger of Railway, General budgets on cards

The Finance Ministry will seek Cabinet nod for the proposed merger of Railway and General Budgets by this month end.

Sources said the government does not expect any fiscal impact by the proposed merger as the Railways has agreed to fund its subsidies through operations. Sources said the Finance Ministry committee will submit its report on the merger of the two budgets by the end of this week.

The move may free the Railways from political pressure and the public sector behemoth will also be relieved of the burden of paying an annual dividend to government in return for budgetary support.

The idea of the merger was floated by Niti Aayog member Bibek Debroy, who felt that the Railway Budget has become an avenue for populism with MPs demanding new trains and stops for existing ones.