New Delhi: The government on Friday raised the railway passenger fares by 14.2 per cent in all classes and freight charge by 6.5 per cent effective form June 25.
The new passenger fares and freight rates aimed at mobilising resources for the cash-strapped Indian Railways come just days after Prime Minister Narendra Modi warned countrymen to get ready for some “bitter medicine” needed to revive the economy and ahead of the full railway budget next month.
The railway ministry said the revision of rates was done as part of the interim budget presented by the previous UPA government, but was not implemented because of the elections which concluded in May.
It said the annual expenditure of the ministry could not be met unless the revised rates as finalised by previous government are implemented.
The hike in passenger fares would bring nearly Rs60 billion (Dh3.6 billion) to the Railways, which needs massive funds to upgrade its infrastructure.
Railway Minister Sadananda Gowda on Thursday said the government is short of resources and some resource mobilisation should be taken as a priority. The national transporter is under a massive fund crunch with subsidy on passenger fares touching Rs260 billion, and needs huge investments to modernise and upgrade its safety system.
The last fare hike was in October 2013.
The decision drew widespread criticism on Friday as many opposition parties said it would cause more inflation.
Barring the BJP, all political parties in Kerala were up in arms against the hike.
Communist Party of India-Marxist veteran V.S. Achuthanandan said this is the first blow rendered by Modi on the people of the country.
“This clearly indicates that the policies of the NDA government are the same as the UPA government, and Kerala is going to be affected hugely because our state is dependent on everything from outside and the hike in freight charges would see instant spiralling of prices of all items,” he said.
At the capital city’s railway station, the news was greeted with anger.
“Was it not Modi who said a hundred times in his election campaign and later that his government will function taking into consideration the aspirations of the common man?” an angry passenger asked.
“ ... This is nothing but playing politics and the common man is always the worst affected,” added another passenger.
Odisha Chief Minister Naveen Patnaik on Friday described the increase in rail fares as anti-middle class and anti-poor.
“Passenger fare hike across the board is going to affect passengers at large and more particularly poor people travelling in sleeper class,” he said.
Rashtriya Janata Dal chief and former railway minister Lalu Prasad claimed the government wanted to hand over the railways to the private sector.
“This is the first major blow to the people by the Modi government. Such a hike is unprecedented, whenever BJP comes, they bring along price rise,” he said.
Janata Dal-United leader and former Bihar chief minister Nitish Kumar, who also served as railway minister in the Atal Bihari Vajpayee-led NDA government, said: “This is no ordinary hike, this is a huge hike. They (the government) are setting a wrong precedent ...”
The Congress Friday strongly opposed the hike in railway fares, saying it would lead to inflation in food prices.
“The increase in railway fares means increase in the cost in transport of food items, which in turn will lead to inflation in food prices,” Congress general secretary Ajay Maken said.