No hope, but lot of hype

The pre-dawn robbery of passengers at knifepoint by a gang of thugs in two second-tier AC coaches of the Jammu-Delhi Duronto Express near Badli in the national capital on January 17 and on another train on the same spot a few hours earlier, are a wake-up call to the Indian Railways (IR).

It is rather ironic that early this month, while responding to a query in the Lok Sabha on security steps, the Minister of State for Railways, Rajen Gohain, said that in a bid to improve safety, Linke Hoffman Busch (LHB)-type coaches, equipped with better safety features, are being “proliferated in mainline trains”.

To be fair to the minister, he did concede that prevention and detection of crime related to passengers, registration of such cases, their investigation and maintenance of law and order in railway premises, as well as on running trains, are the statutory responsibility of state governments. 

But he did mention a three-tier security system existing at the moment - a separate wing of the state police in the name of Government Railway Police (GRP) functioning in the states. 

The security of tracks and bridges is the responsibility of district police with the Ministry of Railways (MoR) supplementing the efforts of states in providing security through the Railway Protection Force (RPF). 

Despite the Railways’  three-tier security system of RPF, GRP and the district police, passengers in running trains are no one’s responsibility till the end of their journey - not even to the security personnel putatively present on prestigious trains.

The interim Budget of the outgoing government is due, in which the finance minister would no doubt wax eloquent over enhanced capital expenditure of astronomical figures for 2019-20. 

With the Centre not obliging the system for higher budgetary allocation, the budgetary support for the Indian Railways has been lower than what has been sought year after year. 

This is so as the Union government must perforce have to make do with competing development priorities and welfare measures. 

Already for the current fiscal, reports are rife to suggest that the Centre is unlikely to stick to its gross budgetary support (GBS) for the Railways of Rs 53,060 crore, by cutting between Rs 5,000 to Rs 10,000 crore. 

If one goes by past performance, in 2017-18, the government went for a slash of Rs 15,000 crore on the GBS for the Railways in the revised estimate.

With this as the background, the worry plaguing the railway board authorities is that they are left with the Hobson’s choice of tapping market borrowings through its outfit, the Indian Railway Finance Corporation (IRFC), which borrows at market rate of interest, the medium to long-term repercussions of which are bound to shove the Railways into an internal debt trap. 

A couple of years ago when Suresh Prabhu was the Railway Minister, he unveiled a plan to rope in LIC to involve itself in railway infrastructure projects spread over five years, starting from 2015-16. 

But in the first three years till the last fiscal, the Railways was able to obtain a paltry Rs 16,200 crore from the LIC, leaving a huge hole in its capital expenditure programmes for the upkeep of rolling stocks, signalling and telecommunication, besides inducting high-speed engines for hauling higher volume of freight.

The idea was to realise more revenues for improving its operating ratio that is at its nadir now. 

This is presumably so as the system is mistakenly cocky of compassing institutional finance for important projects, capacity enhancement projects and last-mile connectivity.

As it is, Indian Railway has been struggling to run its transportation business and generate its own resources to keep its expenditure from outrunning its receipts from diverse activities and sources. 

The share of IR in total freight traffic has plummeted from a peak of 89 per cent in 1950-51 to less than 30 per cent now, thanks to many a thankless task it was asked to perform.

They ranged from keeping low second-class fares in perpetuity to low suburban and non-suburban season tickets and essential commodities being carried below cost.

It also included a host of concessions granted on passenger tickets and working of uneconomic branch lines.  

The National Institute of Public Finance & Policy (NIPFP), tasked to study about fostering a mechanism for computing the value of social cost being borne by IR, contended that the losses on account of concessions in passenger fares, uneconomic branch lines and EMU suburban services may be deemed social service obligations.

It leaves the question of who will foot the bill - estimated upwards of Rs 30,000 crore a year, unclear and unsaid!

Despite carrying obligations like an albatross around its neck, the IR is dreaming big about launching a Bullet train, à la France and Japan, estimated to cost Rs 1,800 crore for a tiny section linking Mumbai-Ahmedabad! 

But when the bedrock of the system is brittle, how can the system ever become an efficient body to execute big things?  

In the name of rationalisation, the IR increased freight rate of coal, raw material for steel plants, iron and steel, iron ore and other goods at 8.75 per cent on November 1, 2018 and jacked up haulage charge of container trains at 5 per cent effective from December 1, 2018. Both these were, interestingly, off-Budget!   

There is no dearth of reports suggesting the system to be viable, but the political will to even part-privatise the mammoth organisation, brooks no assent lest the gravy train for political ends comes to a halt.

Even a modest proposal like setting up an independent regulator --the Rail Development Authority - to insulate pricing decisions from political calculations remains a work in progress for far too long.

Author is a senior freelance journalist