'Introduction of bullet trains, ​​upgrading IT infrastructure are steps in right direction'

The Railway Budget 2014 has focussed on passenger amenities, adoption of technologies, capacity building and commercial soundness, states Arvind Mahajan, Partner and Head of Infrastructure and Government Services, KPMG in India.

According to Mahajan, facilities previously available at only airports will be now be made available at the railway stations.

“The introduction of bullet & high speed trains, ​​upgrading IT infrastructure, including next generation e-reservation system, are the steps in the right direction and addresses the long-felt need of modernising the Indian Railways and making it customer friendly,” he was quoted in a KPMG release.

However, while the budget saw discussions on PPP (public private partnership) and FDI in Railways, the budget speech lacked details and the announcements on the matter.

“….in the coming weeks (it) will be important to understand the specifics….. and it will be to the benefit of nation at large that these steps are implemented sooner,” Mahajan said.

Rail traffic authority

According to him, there should have been discussions on Railway Tariff Authority as it is critical for attractive private investment in Indian railways.

“Overall, the Railway Minister did touch upon key aspects and has shown the intent to turnaround IR into a commercially viable and customer friendly organisation but the specifics of few announcements are awaited,” Mahajan added.

Jaijit Bhattacharya, Partner, Infrastructure and Government Services, KPMG India, said the railway budget provided the much needed strategic financial headroom required for the railways to enable it to make the necessary critical investments in modernisation and expansion.

"The focus on safety and security is much appreciated. The special focus on unmanned railway crossings is a positive move from an overall safety perspective. Increase in RPF constables is a much needed step to improve the security in trains. In addition, using modern technology to enhance safety and security, as well as improved management by deciding to adopt an ERP, is welcome,'' he said.

It would have been helpful if there was focus on non-traffic revenue generation to enhance "the profitability of the railways, he added.

SV Sukumar, Partner, Head Strategy and Operations Practice, KPMG India, spoke on supply chain and logistics stand point.

He said the announcement of FDI in the railway sector and PPP for future projects would have a positive impact in terms of creation of new lines and capacity.

"This would help in achieving better road versus rail ratio for freight movement, thereby reducing logistics cost for the industry, especially for commodity players. On the issue of connecting ports, he said it was a welcome move and would debottleneck logistics and help railways keep in pace with logistics requirements of industries,'' he added.

COMMENT NOW