An increase in passenger fares across all classes, more than 100 new trains, enhanced frequency
or routes for many others, and plans to hire more than one lakh employees were some of the key
or routes for many others, and plans to hire more than one lakh employees were some of the key
Rail Budget proposals made.
Presenting the annual Rail Budget for the financial year 2012-13 in Parliament on Wednesday,15th March,2012
Railway Minister Dinesh Trivedi made following key proposals:
Railway Minister Dinesh Trivedi made following key proposals:
*Passenger fares to be hiked by 2 paise per km for suburban and ordinary second class travel; 3
paise per km for mail/ express second class; 5 paise per km for sleeper class; 10 paise per km for
AC chair car/AC 3-tier and First Class; 15 paise per km for AC 2-tier and 30 paise per km for
AC 1-tier.
paise per km for mail/ express second class; 5 paise per km for sleeper class; 10 paise per km for
AC chair car/AC 3-tier and First Class; 15 paise per km for AC 2-tier and 30 paise per km for
AC 1-tier.
*Minimum fare and platform tickets to cost Rs 5.
*75 new Express trains to be introduced, along with 21 new passenger services, nine DEMU
services and 8 MEMU services trains.
services and 8 MEMU services trains.
*Route of 39 trains to be extended and frequency of 23 trains to be increased.
*Railways to hire more than one lakh employees in 2012-13; 80,000 persons hired last year.
*Indian Railways Stations Development Corp to be set up to re-develop stations and maintain
them like airports.
them like airports.
*To set up an independent Railway Safety Authority as a statutory body.
* The open discharge toilets on trains to be replaced with green (bio) toilets.
*All unmanned level crossings to be abolished in next five years; To target zero deaths due to
rail accidents.
rail accidents.
*To provide rail connectivity to neighbouring countries, a new line from Agartala to Akura in
Bangladesh to be set up.
Bangladesh to be set up.
*Double-decker container trains to be introduced.
*Steps to improve cleanliness and hygiene on trains and stations within six months. A special
house keeping body to be set up to take care of both stations and trains.
house keeping body to be set up to take care of both stations and trains.
*New passenger services include escalators at major stations, alternative train accommodation
for wait-listed passengers, laundry services, AC lounges, coin/currency operated ticket vending
machines.
for wait-listed passengers, laundry services, AC lounges, coin/currency operated ticket vending
machines.
*Two new members, one for marketing, and other for safety, to be inducted into Railway Board.
*On board passenger displays indicating next halt station and expected arrival time to be
introduced.
introduced.
*Introduction of regional cuisine; Book-a-meal scheme to provide meals through SMS or email.
*Specially designed coaches for differently-abled persons to be provided in each Mail/Express
trains.
trains.
*Railway Tariff Regulatory Authority to be considered.
*National High Speed Rail Authority to be set up; Pre-feasibility studies on six high speed
corridors completed; study on Delhi-Jaipur-Ajmer-Jodhpur to be taken up in 2012-13.
corridors completed; study on Delhi-Jaipur-Ajmer-Jodhpur to be taken up in 2012-13.
*Wellness programme for railway staff at work places.
*Institution of ‘Rail Khel Ratna’ Award for 10 rail sportspersons every year.
*A wagon factory at Sitapali, Odisha, rail coach factory at Palakkad, two additional new
coach manufacturing units in Kutch (Gujarat) and Kolar (Karnataka); component factory at
Shyamnagar (West Bengal); new coaching terminal at Naihati, the birth place of Bankim
Chandra Chattopadhyay.
coach manufacturing units in Kutch (Gujarat) and Kolar (Karnataka); component factory at
Shyamnagar (West Bengal); new coaching terminal at Naihati, the birth place of Bankim
Chandra Chattopadhyay.
*Freight loading of 1,025 MT targeted; 55 MT more than 2011—12; Passenger growth targeted
at 5.4 per cent.
at 5.4 per cent.
*Passenger earnings to increase to Rs 36,200 crore.
*Gross rail traffic targeted to increase by Rs 28,635 crore to Rs 1,32,552 crore in 2012—13.
Increasing the fare for the first time in eight years, the Railway budget for 2012-13 also
envisages 113 new trains and promises to focus on safety, for which the Railway Board will be
restructured and a separate authority set up.
envisages 113 new trains and promises to focus on safety, for which the Railway Board will be
restructured and a separate authority set up.
The budget, presented by Railway Minister Dinesh Trivedi, on 15th March,2012, proposes a
steep increase in passenger fares to help the Railways earn an additional Rs.7,000 crore during
2012-13. The lowest fare of Rs. 2 for travel up to 10 km in a non-suburban train has been raised
to Rs. 5.
steep increase in passenger fares to help the Railways earn an additional Rs.7,000 crore during
2012-13. The lowest fare of Rs. 2 for travel up to 10 km in a non-suburban train has been raised
to Rs. 5.
The Railways have planned to increase fares in kilometre terms, starting with 2 paise for the
lower classes and increasing it gradually to 30 paise for air-conditioned first class. The general
increase is up to 30 per cent in the sleeper classes and air-conditioned classes. Thus, for example,
the Delhi-Chennai sleeper class fare will go up from Rs. 488 to Rs. 600, a hike of 23 per cent,
and Thiruvananthapuram to Delhi in AC two-tier will rise from Rs. 2,181 to Rs. 2,650, a hike of
21 per cent.
lower classes and increasing it gradually to 30 paise for air-conditioned first class. The general
increase is up to 30 per cent in the sleeper classes and air-conditioned classes. Thus, for example,
the Delhi-Chennai sleeper class fare will go up from Rs. 488 to Rs. 600, a hike of 23 per cent,
and Thiruvananthapuram to Delhi in AC two-tier will rise from Rs. 2,181 to Rs. 2,650, a hike of
21 per cent.
Railway Budget – Key figures (2012-13)
The budget promises to increase the strength of the Railway Board by taking in two more
members — one for safety and the other for public-private participation and marketing.
members — one for safety and the other for public-private participation and marketing.
A Railway Safety Authority will be set up as a statutory regulatory body. The conditions of
track, bridges and signalling and telecommunication systems will also be improved. To avoid
accidents at unmanned level crossings, a rail-road grade separation corporation will be put in
place.
track, bridges and signalling and telecommunication systems will also be improved. To avoid
accidents at unmanned level crossings, a rail-road grade separation corporation will be put in
place.
The Railway Rupee :
Mr. Trivedi proposes to recruit at least one lakh persons in the next financial year, clearing the
backlog of SC/ST/OBC vacancies and those in other categories, while filling all slots to ensure
the safe running of trains and the safety of passengers.
backlog of SC/ST/OBC vacancies and those in other categories, while filling all slots to ensure
the safe running of trains and the safety of passengers.
Safety measures, green initiatives
Among the other safety measures announced by Mr. Trivedi in his budget are increasing the
number of trains to be escorted by RPF/GRP personnel to 3,500 and integration of the RPF
helpline with the All-India Passenger Helpline.
As part of the Railways' green initiative, 2,500 coaches will be equipped with bio-toilets, 200number of trains to be escorted by RPF/GRP personnel to 3,500 and integration of the RPF
helpline with the All-India Passenger Helpline.
remote stations will be powered by solar energy, solar-lighting systems will be installed at 1,000
manned level crossing gates, and two bio-diesel plants will be commissioned at Raipur and
Tondiarpet.
Indain Railways – the safety report:
The passenger amenities proposed include 321 escalators, of which 50 will be installed in 2012-
13, six mechanised laundries, new Rail Neer plants at Palur in Tamil Nadu and Ambernath in
Maharashtra, an alternative train accommodation system for wait-listed passengers and specially
designed coaches for differently-abled persons in all mail and express trains.
Patients suffering from Aplastic Anaemia and Sickle Cell Anaemia will be given 50 per cent
concession in fare in AC 2, AC 3 and Chair Car and Sleeper classes. The Arjuna awardees will
get the facility of travelling by the Rajdhani and Shatabdi trains.
Despite the poor state of the system and the Railways' inability to fulfil the promises made in
2011-12, the budget proposes 75 new express trains, 21 passenger trains, nine DEMU and eight
MEMU, besides extension in the service of 39 trains and increase in the frequency of 23.
Mumbai will have 75 additional suburban services, Chennai 18, Kolkata 44, and Kolkata Metro
60.
For resource mobilisation and modernisation, two corporations will be opened: the Indian
Railway Station Development Corporation and the Logistics Corporation.
Schemes for private investment in wagon-leasing, siding, private freight terminals, container
train operations and rail connectivity projects will be made more attractive to investors. To
facilitate this, the Railway Board will have a new member.
A National High Speed Rail Authority will be set up to run high-speed trains in future. A pre-
feasibility study will be done for the Delhi-Jaipur-Ajmer-Jodhpur corridor, in addition to the
six corridors proposed. As for connectivity to neighbouring countries, the project to connect
Agartala with Akhaura in Bangladesh will be taken up in 2012-13.
Mr. Trivedi announced the setting up a wagon factory at Sitapali in Odisha's Ganjam district,
while two coach factories will be established at Kutch in Gujarat and Kolar in Karnataka. A
plant for making traction alternators for high- horse power diesel locomotives will be set up at
Vidisha, Madhya Pradesh.
Two projects have been proposed for West Bengal to make next-generation propulsion systems
for use in high-power electric locomotives at Shyamnagar, and augmenting the electric loco
ancillaries unit of the Chittaranjan Locomotive Works at Dankuni for fabrication of locomotive
shells and assembly of three- phase locomotives for manufacture of 9000-HP locomotives.
A survey and feasibility study will be done for new coach terminals at Nemam, Kottayam, Mau
and Dankuni, for the development of the Royapuram station in Chennai, a new coach complex
at Panvel and coach maintenance complexes at Khlamboli in Maharashtra and at Naihati, birth
place of Rishi Bankim Chandra Chattopadhyay, in West Bengal.
When the Railway Minister, Mr Dinesh Trivedi, presented the Indian Railways Vision 2020
Document in December 2009, the emphasis was on moving to a higher growth trajectory,
network expansion and capacity creation. The other areas of importance were train safety
mission, environmental sustainability and introduction of innovative measures for reinventing
passenger services and freight services. Technological excellence was also an integral part of the
Vision.
Also, to enhance the effectiveness of accountability of the Railways at all levels within the
Government, a framework for judicial internal reorganisation was contemplated. The ongoing
work on accounting reforms was expected to be given a boost and thus to reap the benefits of
better analytical tools for effective decision-making. It is a happy augury that a beginning has
been made to concretise the objectives and goals enunciated in the Vision statement through the
Railway Budget 2012-13.
Railways is one of the most studied organisations. Recent additions to the plethora of reports are
the ones on safety and modernisation. The high-level railway safety committee recommendations
have been sought to be implemented by eliminating the unmanned level crossings in the next
five years. Yet another announcement is about the setting up of a Railway Safety Authority.
Signalling safety
Railways has been taking a number of steps to achieve zero level tolerance for accidents. The
Vision document stresses the importance of a combination of technological and human resource
intervention. Notable among them is the introduction of advance in signalling technology and
train protection systems.
The Budget contemplates introduction of such systems over 3,000 km. All these measures are
welcome; it may be noted that a more detailed corporate safety plan has been prepared and a
systematic follow-up of the plan would have enabled the Railways to reach the desired level of
safety.
A satisfactory feature of the Budget with regard to capacity augmentation is the modernisation of
19,000 km high density network, which carries 80 per cent of the traffic.
The measures taken through setting up of Special Railway Safety Fund in 2001-02, coupled with
the policy decisions taken on freight traffic for heavy axle load movement, were considered to be
crucial steps in meeting the demand for freight traffic when the economy was doing well.
Similar benefits will accrue to the Railways to realise the contribution of 3 per cent of GDP
by 2020, which translates into Rs 2,70,000 crore of revenue, nearly a three-fold increase from
Rs 90,000 crore for 2010-11. Since the dedicated freight corridors are not progressing at the
expected speed, the focus on high density network or the golden quadrilateral is significant.
The revised estimates of 2011-12 indicate an adverse trend, as the operating ratio, which was
expected to be 91.1 per cent, is likely to go up to 95 per cent. Yet another worrisome feature was
the interest bearing loan of Rs 3,000 crore given by the Finance Ministry.
Even with the reduction in the dividend rate by 1 per cent (from 6 to 5 per cent), thanks to the
convention committee recommendations, the revised estimates for 2011-12 definitely sent
warning signals. The internal generation of resources, which was projected over Rs 5,000 crore
also had not materialised. Given this scenario, the Railway Minister had no other option but to
increase the passenger fares, which had not been touched from 2002-03.
A more positive aspect of this enhancement is that the suburban fares have also been touched,
and it is not the holy cow it used to be.
Accounting reforms
The Budget talks about a high-level committee to examine the need for a rail tariff regulatory
authority. The recommendations of the committee, the Minister promises, will be discussed in
Parliament.
There is also a mention of a linkage with the fuel component of the cost. These are steps that
indicate the seriousness with which the issue of cross-subsidisation is being addressed by the
Ministry.
In this context, the importance given for the completion of accounting reforms is appropriate
as the traffic costing in Railways has been a highly complex one with a substantial portion of
joint costs (costs which get allocated between passenger and freight, on ratios). The accounting
revamping contemplated will be able to capture the cost of running a passenger train in a more
accurate manner. No further time should be lost in implementing this valuable tool.
It is generally believed that the Railway's weakness is its failure to offer a door-to-door service
like the road. Though there are sidings which serve the same purpose and the Railways had
also introduced a number of policy measures to make the construction of private sidings more
attractive, the response has not been positive, except for bulk commodities.
In this context, the announcement that a logistics corporation to provide a total logistics solution
will be set up may be appreciated by the industry. The corporation should really concentrate on
capturing the high-rated commodities to increase the rail co-efficient.
Plan outlay
The Railways Plan outlay is a matter of interest to the industry. There has been only a marginal
increase in the total Plan outlay, though it has been claimed that the figure of Rs 60,100 crore is
the highest ever.
With gross budgetary support falling short of the demand (Rs 25,000 crore as against Rs 45,000
crore) and internal resource generation yet to pick up, it is not possible to expect a higher outlay.
Since the 11{+t}{+h} Plan outlay is likely to show a shortfall of Rs 30,000 crore, the Railways
may have to step up their efforts to achieve the targeted 12{+t}{+h} Plan outlay through the
much-talked about public-private- participation route. The Budget rightly recognises the need to
augment the Depreciation Reserve Fund if only to avoid a repeat situation of the arrears in the
replacements and renewals which would have the disastrous effects of crippling the system.
The Fund, which had a healthy balance of Rs 4,000 crore, during 2005-06 has been dwindling
and reached Rs 5 crore, as of March 31, 2011. Hence, appropriation of Rs 9,500 crore provided
for in the Budget for 2012-13 is warranted.
The Railway Budget thus has embarked on a mission to reach the Vision by 2020. The measures
announced indicate the earnestness to put the organisation back on the rails and come out of the
financial slide.
Now that a small beginning has been made, it is anticipated that the tempo will be maintained for
restoring the financial health of the system.
Conclusion
At present service sector in India account for more than half of India's GDP.
According to the data of the financial year 2006-07, the share of services, industry,
and agriculture in India's GDP is 55.1 percent, 26.4 per cent, and 18.5 per cent
respectively. Now the service sector accounts for more than half the GDP i.e. 51%
makes a watershed in the evolution of the Indian economy and takes it closer to the
fundamentals of a developing economy like India. In the development of service
sector Indian Railways is in the unique position to become the backbone of
information transport in India making India one of the best nations in terms of
communication infrastructure. Indian Railways is in a dynamic phase of growth
with new initiative planned to capitalise on the existing gains and moving steadier
and closer to the large objective of offering world class services to national and it's
rank and file.
