To merge or to chug alone? Konkan Rly awaits verdict

The future of the Konkan Railway Corporation Limited (KRCL) hangs in the balance.

The KRCL, considered one of the best railway networks by the World Bank two years ago, is trying to figure out its very survival - whether it will continue as an autonomous entity or merge with the IR.

Designed with the aim of connecting the four coastal states of Maharashtra, Goa, Karnataka and Kerala, making them a party to the agreement with the Indian Railways, the corporation now ceases to exist. The KRCL, founded in 1990, will be completing its intended tenure of 15 years this month. Now, the Railway Ministry will decide its fate.

If the KRCL is merged with it, the the Indian Railways will have to not only take up the assets and intellectual properties owned by the corporation but also its accumulated losses - Rs 5,000 crore - and its debts with other liabilities.

Sources in the KRCL told DNA: “The loss incurred due to the financing costs was made good by the ministry by extending non-interest bearing loans. But in 2003 the ministry started charging interest on these loans at seven per cent. If this is waived off, the corporation can reduce the extra costs.”

The ministry has instituted a review committee to study the aspects associated with the merger and also to design a revival package, which will be tabled before the Cabinet. Pending this, the KRCL has been granted one year’s extension.

National Railway Mazdoor Union assistant secretary Milind Tulaskar, who also is associated with the KRCL, said, “The KRCL has a low operating ratio in view of its low staff cost and multi-skilling practices. Therefore, it cannot generate enough surpluses to take care of the loan burden and build infrastructure in the future.”

At stake are the jobs of nearly 3,500 employees who are with KRCL since its inception.

“The corporation has in its 15-year tenure developed and earned a lot for itself. Despite being criticised for the accidents, we have also been appreciated for the technologies invented and the international patents earned,” said an official of the KRCL on condition of anonymity.

So the big question is: will the merger of the KRCL with the Indian Railways affect its efficiency?

Passengers who travel to their hometown by the Konkan Railway route think such a move would render it inefficient.