Urgent Course Correction Imperative for Indian Railways

Raghu Dayal, former Chairman & Managing Director of CONCOR and Senior Fellow, Asian Institute of Transport Development, delves into what ails the Indian Railways and suggests ways of bringing it on track.

IR’s freight and passenger business over 2014-15 to 2018-19

Railways’ freight and passenger businesses over the 5-year period, i.e., 2014-15 to 2018-19 (budgeted) indicate a flat growth. The number of total passenger journeys would record a CAGR of 0.22%, passenger kilometres 0.16%, and freight output in terms of net tonne kilometres 0.02%. Whereas, its gross revenue receipts over the period show a CAGR of 4.55%, and its working expenses a CAGR of 5.46%.

The broad financials relevant to IR revealed in India’s Union Budget for fiscal 2018-19 help assess its strategies and plans in the immediate phase. A close look at IR’s budgeted passenger and freight traffic profile indicates that IR would remain content with miniscule incremental increase in its businesses. The freight traffic budget envisages an increase of 4.8%, from 652 billion freight tonne kilometre (NTKM) in 2017-18 to 683 billion in 2018-19 and 3.8% rise in freight revenue, from ₹1,17,500 crore in 2017-18 to ₹1,21,950 crore in 2018-19. There is an increase budgeted to the extent of 1.86% in total passenger-km, from 1,135b in 2017-18 to 1,157b in 2018-19, and an increase of 3.7% in passenger revenue, from ₹50,125 crore in 2017-18 to ₹52,000 crore in 2018-19.

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