Much of the current mess Indian Railways is in has to do with decades of rampant political opportunism. In 2005-06, several top management schools were writing case studies on the smart turnaround of the Railways, but now it is back to where it was — staring at a financial crisis.

The Railways should be seen as a tool for nation building, and not as a tool for building constituencies. Political reform should take place around four major themes — depoliticised investment planning, flexible tariff policy, rethinking on un-remunerative assets and operational freedom.

Giving steam The tariff policy should eventually aim at removing subsidy of passenger travel by freight traffic and ensure that sustainable, rule-based revisions are linked to input prices. Un-remunerative branch lines should be closed. If social goals are paramount, set up an independent ‘branch railway line commission’, with members from the State governments concerned and the Railways to assess the subsidy needed for breakeven levels of operations. The subsidy burden should be raised from non-Railway sources and its levels should be assessed periodically.

Also, corporatise manufacturing units and set up joint ventures with private sector companies to drive research, development and innovations and turn them into profit centres.

Some of the activities such as catering have immense potential for garnering additional revenues if quality restaurant chains are brought in based on a revenue-share model with long-term contracts. Militant trade unionism in the Railways should be brought to an end. Productivity norms should be agreed upon.

The Rail Budget rightly flags off a public-private-partnership (PPP) policy. In such projects, risks that cannot be borne by either parties should be left to insurance markets or to the Government itself. Finally, land as a resource for generating investible surplus needs out-of-the-box thinking linked to PPP policy.

Organisational reform Is departmentalism a serious malady of the Railways? In such a setting, a well-trained techno-bureaucracy gives a unique edge to the Railways and this is well understood by the Railways professionals. The Railways requires careful re-engineering with leadership development as its cornerstone.

It should introduce accelerated promotions to the upper echelons of the bureaucracy for meritorious candidates through a well-designed leadership programme. The level of general managers should be reached in a maximum of 20-25 years. Incumbents to the posts of GM and Divisional Railway Manager (DRM) need to act as true arbitrators on issues of a interdepartmental nature.

Tenures at the DRM, GM and Board members need to be a minimum of five years. The Railway Board should decentralise powers to the GM and concentrate on the larger picture.

An independent accident investigation agency should be set up, with a clear mandate to identify the cause of major accidents and provide suggestions to avoid recurrence.

An energised Railways will look at the nooks and crannies and improve all aspects of functioning. It can bring in new products and services — there are many in waiting, such as energy audits, regenerative braking on all locos and Emus, containerisation, structuring successful high speed rail initiatives, and so on.

The writer is chief risk officer at L&T Infrastructure Development Projects. The views are personal

Related Topics
comment COMMENT NOW