Rail Budget 2015-16 India Preview : Focus resurrection of Railways

Rail Budget 2

Rail Budget preview 2015-16

Rail Budget 2015-16 would act as an enabler in beginning the process of resurrecting Indian Railways, which has been ailing due to varied reasons ranging from policy to operations. One of the most prominent focus issues for the new government would be the financial restoration of the national carrier: Indian Railways (IR). IR with nearly 64,460 km route length is the fourth largest network in the world, operating close to 19000 trains a day and transporting about 2.65 million tonnes (MT) of freight traffic and 23 million passengers. However, over the decades severe red tape and populist measures have taken their toll on the carrier with monumental losses and operational inefficiencies creeping into the system. According to recent data, railways is reeling under huge losses in its passenger segment of nearly | 24,600 crore in FY13, up 9%, from | 22,500 crore in FY12 and needs concrete steps to overhaul both its finance and operations. With a dismal operating ratio of 90.8% in FY14 (RE) it is imperative for railways to modernise its network and improve its yield in the passenger segment. We believe the Railway Budget 2015-16 will focus on enhancing safety and services by driving better internal generation of resources (fare hike in June 2014 is a step in that direction). The hike in railway fares would provide a buffer to the Railway Minister through which he would be able to spend on better amenities for passengers and somewhat enhance IR capacity through capex to improve the operational efficiency of existing network.

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