Business | Economy
Indian rail budget keeps fares and cargo costs low
India's railway minister unveiled a mix of populist measures, including cheap tickets for the poor and no increase in freight or passenger fares, as well as steps to boost the sprawling system's efficiency and finances.
- Reuters
- Published: 23:26 July 3, 2009
New Delhi: India's railway minister unveiled a mix of populist measures, including cheap tickets for the poor and no increase in freight or passenger fares, as well as steps to boost the sprawling system's efficiency and finances.
Friday's railway budget speech underscored the Congress party-led government's focus on "inclusive growth" after it was reelected by a wider-than-expected margin in May. Prime Minister Manmohan Singh's government will present its budget on Monday.
"The old mindset of economic viability should be substituted by social viability," Railways Minister Mamata Banerjee said in an address to parliament.
Banerjee, looking to take advantage of the railway's vast property holdings, said land along the new freight corridor would be put to productive use, and also said the railway operator will resume issuance of tax-free bonds.
Over the five years through March 2009, India's railways generated a cash surplus of about $18.8 billion (Dh96 billion).
She also said the group will build a 1,000 megawatt electricity plant - India suffers from a severe energy deficit - to power electric locomotives. She said the system would look to introduce double-decker trains, and take advantage of its fibre-optic communications network.
"I visualise an eastern industrial corridor developing alongside the eastern dedicated freight corridor," she said in the ministry's annual budget address.
Arun Kejriwal, a research strategist in Mumbai, said the speech gave a clue to the government's policy leanings.
"One key takeaway that probably is an insight for the main budget is that the the common man, seems to be an underlying concern," Kejriwal said.
"That gives you a hint that if anybody is expecting great things, a forward-looking reformist budget, I'm not sure that is the right way to look at it."
With a 63,327-km network, the railways play a key role in Indian life, transporting more than 18 million passengers and more than 2 million tonnes of freight daily.
But the system is plagued by crowding and outdated technology. Every day, about 8 million passengers cram onto commuter trains in the financial hub of Mumbai, with roughly a dozen daily fatalities.
Banerjee said meeting needs of passengers is more important than fin-ancial performance.
To that end she said 50 stations would be upgraded to international standard, and she outlined plans to improve toilets, food and water availability, and shopping at stations.
For the poorest passengers, for whom railway transport is the most popular form of long-distance travel, Banerjee said fares would cost just Rs25 (Dh1.90) for trips up to 100 km.
She set a target for freight traffic in the fiscal year that ends in March 2010 of 882 million tonnes, up 6 per cent from a year earlier.
Share this article
Popular in Business
-
Global Village
A world of fun
Revamped layout featuring four cultures to greet visitors this season
Business Editor's choice
-
Time to stop going with the flow
Awareness vital if Gulf states are to overcome dependence on desalination plants
-
Jeddah chamber elects first female
Lama lauds growing influence of women
-
Big Bus makes a stop at Abu Dhabi
Double-decker tour offers visitors a glimpse of capital's cultural treasures
