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ShareKolkata: The continuing economic slowdown and the Sixth Pay Commission pay-out have impacted the financials of the Indian Railways. As a result, the operating ratio is at an all-time high of 92.5% for the budgeted year 2009-10, from 90% in 2008-09 and 75.9% in 2007-08.
The operating ratio is an indication of the money spent to earn an amount. So, as against the Railways spending Rs 75.9 to earn Rs 100 earlier, it will now have to spend a much higher amount of Rs 92.5 to earn Rs 100.
However, the Railways will still have a cash surplus of Rs 14,201 crore (before dividend) in 2009-10 and a net revenue of Rs 8,121 crore. The ministry has absorbed an impact of Rs 14,600 crore because of the payout of 60% of the arrears of the Sixth Pay Commission this year, Railway Board chairman S S Khurana said at a press conference on Friday. In 2008-09, the cash surplus was Rs 17,400 crore after disbursing Rs 13,600 crore towards 6th Pay Commission.
Earlier in the day, railway minister Mamata Banerjee said in her rail budget speech that she was forced to review the targets set for 2009-10 (by her predecessor Lalu Yadav) in the interim budget of February as they were "unrealistically high". She spoke about shortfall in performance of the Railways in 2008-09 including in freight loading and revenues from commercial utilisation of surplus railways land.
She added, "I have now set more realistic targets for 2009-10 based on the continuing trend of recession in the manufacturing sector and exports." Gross traffic receipts is estimated at Rs 88,419 crore in 2009-10, which is Rs 8,557 crore more than last year.
The railway ministry has received an increase of Rs 5,000 crore as budgetary support from the finance ministry, over and above the Rs 10,800 crore committed in the interim budget.
This has enabled the railways to step up the plan allocation to Rs 40,745 crore.
Besides announcing initiatives like non-stop trains, revised tatkal (instant ticket booking) norms and Vision 2020 (targeting long term business goals), the minister said, "I will now develop new innovative ideas for land and air space utilisation purposes through the PPP (public private participation) mode."
It is believed that the Indian Railways would have a better income from the revised tatkal scheme.
According to the new scheme, bookings can be done from one destination to another, unlike the earlier practice of end to end booking. According to sources, currently 10 to 30% seats are allocated on trains for tatkal bookings, but the utilisation is only around 12.5% as passengers are reluctant to pay end to end fares when they are not traveling the entire distance.
The annual income of Indian Railways from the tatkal scheme is estimated to be around Rs 625 crore, and this is expected to go up significantly with the revised scheme even if it means cheaper tickets.
As for the recent diesel price hike by Rs 2, Railways would be impacted by around Rs 460 crore. This is because, the railways uses around 2.3 billion litres of diesel annually. But, there's no change in fare or freight in the Rail Budget.
Mamata has proposed to take concrete steps to make Indian Railways a strong, responsive organisation. She's planning a White Paper soon to indicate Railways' operational and financial status. She has also promised to develop a Vision 2020 for the Railways.
