The Hindu Business Line : Realistic track

If fares and freight have not been raised even in the face of a decline in profitability in the coming year, it is clearly a gesture not of populism but of realism.

The Railway Minister Ms. Mamata Banerjee’s first Budget turned out to be a routine one full of populist rhetoric and promises of upgradation of services and network infrastructure. There are a few plans however that mark this Budget out from earlier ones.

Ms Banerjee began her speech with the usual bow to populism: inclusive growth and the role of the Railways in fostering development in regions so far untouched by progress. Her populist credo appeared to be to counter questions on economic viability of projects with arguments about their social relevance. This premise led her to detail populist measures mainly in the form of fare concessions for youth and workers in the unorganised sector, provisions for women employees and female passengers not to mention a slew of super-fast trains, non-stop trains and a stress on improving passenger services for which she more than doubled the interim budgetary provisions. In the same vein she announced plans to upgrade facilities in 375 stations, to turn 50 more into world class terminals and provide multi-functional complexes in 50 other stations, all with public-private partnerships (PPP). The Rail Minister also laid out plans for additional wagon output capacity in depressed areas and temperature controlled centres for perishable commodities in the PPP mode. In her earlier tenure as Railway Minister in 2001, Ms Banerjee had announced plans for laying an optical fibre network along railway tracks for commercial purposes; unsatisfied with the work so far she wants an expert committee under Mr Sam Pitroda to consider ways of extending the network to remote areas. Noting that the Railways have ‘vast’ revenue potential from non-traditional businesses she plans to use land and air space for commercial purposes through the PPP route. On the other hand there may soon be some worries on the bread-and-butter business, the haulage of coal and petroleum products that provide the bulk of the freight earnings. Cross-country petroleum pipelines are making some rail movement redundant; and better port connectivity may snip the leads on coal movement to power stations. Investments in dedicated freight corridors and in better handling facilities at termini are needed if the Railways are to retain their competitive edge in the transportation business. If fares and freight have not been raised even in the face of a decline in profitability in the coming year, it is clearly a gesture not of populism but of realism, that in an economic downturn even the Railways cannot take customers for granted.

Targets for the current year have been scaled down. Yet they will prove nourishing for manufacturing and the IT sector only if the budgetary schemes are implemented. There lies the rub. Noting delays in project execution Ms Banerjee has announced a ‘project monitoring committee’ to ensure time lines are adhered to. If it succeeds, her first Budget may become a historic one indeed.

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