The Planning Commission stressed on the urgent need for the railways to remain financially viable.
If the Planning Commission of India (PC) has its way, rail travel will become costlier. In a letter to the finance ministry, the commission has pitched for upward revision of passenger fares so that the railway ministry is able to helm its dwindling finances.
The commission stressed on the urgent need for the railways to remain financially viable.
“The department of railways is in urgent need of expansion and modernisation, while the railways must do much more to restore financial viability by reforming the passenger tariff structure and also relying on the PPP mode much more than they have done,” said the PC in its letter. The railways suffer losses to the tune of Rs14,000 crore annually on passenger operations, which get subsidised through freight earnings. The ministry has not increased the fares for over a decade now.
Raising fares may prove detrimental to the aam aadmi agenda of railway minister Mamata Banerjee, who has got a lot at stake in the upcoming West Bengal elections. Banerjee’s ministry had already been at loggerheads with the finance ministry on the passenger fare front. The finance ministry gave an instant dressing down to the railways last year while turning down railway ministry’s proposal to exempt railways from paying dividend to the government for a five-year period.
Maintaining that the railways need to jack up the passenger fares, the finance ministry said, “We would like the railways to have certain discipline. They have not done anything on the passenger side. In fact, they are giving away more and more. Even if they were to marginally increase, it would make a big difference. We want them to show some intent that they are tightening,” said the finance ministry last year.
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