The engine is politics

Given India's fractious politics, a Railway budget wouldn't be a Railway budget if the Opposition didn't accuse it of being “anti-people.” But when the charge comes from the Treasury benches — and from the coalition partner to which the hapless minister belongs, whose leader then goes on to demand his sacking — the signals this sends out about the state of the government are not at all encouraging. Considering the financial crisis the Indian Railways is passing through, Railway Minister Dinesh Trivedi has tried to arrest the slide. But the method he has chosen hits poor citizens the hardest. Ironically, it was his predecessor, Mamata Banerjee's pursuit of a political agenda in West Bengal that sent the railways down a dangerous financial track. The problem with populism is that it is impossible to sustain indefinitely. For eight years, successive Railway ministers took pride in never raising fares. Of course, when the deferred rise eventually comes, the one-shot hike hurts more than if there had been continuous but marginal increases over a longer period. So while Ms. Banerjee is obliged to decry Mr. Trivedi's fare increases — which range from 20 per cent to 150 per cent depending on the fare class and distance travelled — she must share the blame for this kind of crisis budgeting. The Minister tried to soften the blow by a major pre-budget revision and rationalisation of freight tariffs that should raise Rs. 20,000 crore a year. But the opposition to his budget makes a fare hike rollback for the poorest of passengers inevitable. Where Mr. Trivedi has scored is in his focus on safety. Besides setting up a Railway Safety Authority as a statutory regulatory body as recommended by the Kadkodkar Committee, tracks, bridges, signalling and telecommunications, rolling stock, stations, level crossings and freight terminals will all be focus areas. Mr. Trivedi's decision to pursue the redevelopment of stations through the PPP mode may help upgrade passenger facilities but the contracts and projects must be carefully audited. He also said a Logistics Corporation will take on freight, and a national High Speed Railway Authority will be set up to look at the six corridors identified for development. However, the key index the Railways has to look at is the Operating Ratio — the amount spent to generate Rs. 100 in revenue — which has climbed to 95 per cent. Mr. Trivedi intends to bring this indicator down to 84 per cent in the coming year. The long-term health of the Railways depends on meeting that efficiency target and going beyond it; squeezing a few extra rupees from those passengers who may least be able to afford it is hardly the answer.