Railway Budget 2016-17

The Railway Budget of 2016, presented by Rail Minister Suresh Prabhu on 25 February 2016, was a signature NDA budget. It outlined the NaMo administration’s vision for modernization of the Indian Railways with a classic emphasis on services – an outlook that has now become synonymous with all the schemes that have received the PM’s approval in the past couple of years. The budget was lauded by many and criticised by others in equal measure. Here is a look at some aspects of the Rail Budget.

Paradigm Shift

Suresh Prabhu’s vision for the Indian Railways, as detailed out in his 2016 budget speech, is a paradigm shift in the outlook, operations, functioning, and in perception. Right from the time a passenger seeks to book a ticket, to the experience at the railway station, in-train facilities and food, and support systems, Prabhu plans to take the railways through a major change.

Undertaking various technology-based mechanism such as Social Media and IVRS systems, swanky refurbished coaches, 17,000 bio-toilets, Wi-Fi enabled stations, 1780 Automatic Ticket Vending Machines, increasing ticketing capacity to 2000 tickets per minute and a number of public services such as wheelchair enabling stations and toilets, providing 50% lower berths quota for senior citizens, and 33% for women, Prabhu also announced a number of initiatives such as widespread organizational restructuring, new research as development and data analysis initiatives, and review of key systems such as service delegation and service contracts evaluation, apart from monetization of land along the tracks.

Is It A Populist Rail Budget?

The media and popular analysts are deeply divided over this question. While some say that bringing about all the service changes as promised by the minister is merely offering candy to the crying child and it is the NDA government’s way of placating the vote bank without offering any real benefits such as additional trains, or fare relief.  Others, however, are using the very same reasons to deny that the rail budget is a populist one. The intent of the NDA administration, says the PM, is to strengthen the rail infrastructure, to make India’s rail network the backbone of its development. This will happen only if existing projects are completed, services improved, and the overall rail machinery modernized, and not merely by taking on newer undertakings and blocking more resources. Over 2000 kilometres of the rail network are to be electrified this year.  This is a budget that is aimed at consolidation, says Minister Prabhu.

No Changes in Passenger Fares, Freight

Desisting from increasing passenger fares or freight charges in the Rail Budget 2016 must not have been easy with the railways failing to meet its revenue target for the previous year. The gross traffic receipts for FY 16 were expected to be INR 1.83 lakh crore but actual revenue was just about INR 1.67 lakh crore. Revenue from freight traffic, similarly fell short at INR 1.13 lakh crore instead of the expected INR 1.21 lakh crore. For the forthcoming year, Prabhu has set a target of gross revenue at INR 1.85 lakh crore with a planned outlay of INR 1.21 lakh crore.

The only new train announced in the Budget by Railway Minister Suresh Prabhu was between Delhi and Varanasi. The Mahamana Express will have modern refurbished coaches. He said that the provision of passenger facilities and amenities of stations at pilgrimage centres such as Ajmer, Amritsar, Bihar Sharif, Chengannur, Dwarka, Gaya, Haridwar, Mathura, Nagapattinam, Nanded, Nasik, Pali, Parasnath, Puri, Tirupati, Vailankanni, Varanasi and Vasco would be top priority.

Not a Budget

One of the major criticisms faced by the Railway Minister with regard to the budget was that it sounded more like a bunch of policy statements rather than a budget that clearly spelt out the income, revenue and outlay aspects of the Indian Railways. Hardly any emphasis was laid on the various projects, their costs, and sustainability. Instead, the Railway Minister promised to woo back freight traffic and launch dedicated freight corridors without going into the specifics. No comparative analysis was presented discussing the change in strategy over last year’s model.

The Minister did, however, speak of initiatives taken by the railways to save revenue such as procurement of energy directly resulting in a saving about INR 3000 crore etc. He also said that the target Operating Ratio (OR) for FY17 would be 92%, joint ventures with states and PPP development was on the cards.

Focus North East

Ever since it took up the administration of the centre, the NDA government has placed a sharp focus on the development of the northeastern states. This region was vastly neglected by the UPA, despite the fact that prior to 2014, most of the 7 states were pro-Congress. In November 2015, Suresh Prabhu inaugurated the first broad gauge passenger train between Silchar and Guwahati providing South Assam much needed rail connectivity. He also promised work on the Jiribam-Imphal route and more passenger trains from Silchar. Arunachal Pradesh and Tripura have also been placed on the rail map of the country.

Taking this forward, in his budget speech Suresh Prabhu promised broad gauge rail connectivity to Mizoram and Manipur. He said that there would be an increase in the allocation of funds for the Northeast Frontier Railway (NFR) from INR 35,065 crore to INR 40,000 crore.

Small But Significant

The signature NDA emphasis on the small but significant aspects of any institution was also seen in the Railway Budget 2016. The minister announced a scheme for softs skills training of porters at the various railway stations of India and renaming them Sahayaks – a move aimed at according dignity and pride to their work. Apart from a target of eliminating unmanned level crossings (by 2020) the minister also emphasised on the safety mechanisms to be undertaken for railway personnel such as the introduction of the Ayush scheme in Railway hospitals, and providing gang men with lighter tools for patrolling and handing them devices called ‘Rakshak’ which shall intimate them about an approaching train, ensuring their safety.

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