The Narendra Modi government may introduce ‘creeping’ hike in rail fares by September this year. The go-ahead has come from The Prime Minister’s office directly. The decision to work on the proposal came after a meeting of the infrastructure ministries in April chaired by PM Narendra Modi in which the state of Railways was discussed.
According to a report in The Indian Express, To implement creeping increase in passenger fares was one of the the actionable points for the national carrier issued by the PMO. The timeline decided for its implementation and agreed to by Railways is September 2017. In the meeting it was also mandated that the Railways should work as “a commercial enterprise with focus on core operations to provide efficient and safe travel while enhancing customer experience”.
According to a top Railway Board functionary, From the point of view of commercial viability, the need of the hour is to increase the fares of non-AC classes as they have remained unchanged for ages. Last Year, the Rail ministry introduced surge pricing in its three premium trains — Rajdhani, Duronto and Shatabdi Express. But that exercise had mostly spared non-AC, General Classes.
Governments often shy away from hiking rail fares as it directly impacts millions of people and they are also wary of the political fallout of their decision. The Railway ministry was always seen as a.The Railways’ version of being pro-poor is to cross-subsidise passenger fares by freight rates. In their time as railway minister, both Lalu Prasad and successor Mamata Banerjee never hiked fares. Lalu in fact reduced fares in his last Rail Budget by 2-7 per cent across classes.
Former railway minister Dinesh Trivedi had to earn his party chief Mamata Banerjee’s wrath after he introduced a hike in passenger fares in his Rail Budget of 2012-13. Trivedi was sacked and his successor Mukul Roy withdrew the proposed hike.The losses of Indian Railways rose at an average rate of 18% a year from Rs.6,159 crore in 2004-05 to Rs.19,964 crore in 2010-12. However, it was Pawan Bansal who hiked fares across classes in 2013 months after Trinamool Congress walked out of UPA alliance. The fares were raised by between 2 paise and 10 paise per km across classes.
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