Railways' operating ratio could be worst ever in FY18

Railways' operating ratio, the direct indicator of the working of the government-run transporter, could settle at 98.5% for 2017-2018, recording its worst performance ever since 2000-2001 when it was 98.3%, an official said.

He said the number reflects the increased burden of allowances and pensions that have gone up because of the revision in the 7th Pay Commission.

An operating ratio of about 98.5% in FY18 would mean a dip of more than 2% in the revised 96% figure announced in the 2018 Union Budget. The operating ratio indicates how much railway spends to earn a rupee.

The official also said that less than expected revenues from monetisation of assets and dividend from PSUs going directly to the Ministry of Finance after the merger of the Budget made things worse for the national transporter.

Railways' salary bill in 2017-2018 increased by around Rs 10,000 crore, while pension liability rose from Rs 10,795 crore. It also carries the load of a Rs 33,000 crore passenger subsidy.

The operating ratio has been hovering above 90% for the last six years. In 2013-14, it was around 94%.

The operating ratio target for the current year has been set at 92.8%.