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HindustanTimes Mon,01 Sep 2014

Interim rail budget: more trains, fare cuts likely

Srinand Jha, Hindustan Times  New Delhi, February 11, 2014
First Published: 12:44 IST(11/2/2014) | Last Updated: 10:50 IST(12/2/2014)

Railway minister M Mallikarjun Kharge plans to hold out promises of a possible reduction in train fares while presenting the ministry’s vote on accounts in the Lok Sabha on Wednesday.

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Interim budget speeches of outgoing Railways ministers are usually silent on policy matters or mega projects. But Kharge intends to ask for financial provisioning for the construction of more than 500-km of new lines worth more than Rs. 3,500 crore, while announcing the launch of a 66-km corridor from Mughalsarai to Sonnagar on the Dedicated Freight Corridor project, sources said.

In what will be UPA-II’s last and Kharge’s first budget-related exercise in the run-up to the Lok Sabha elections, notional concessions on passenger fares are likely to be offered by way of promises of further cross-subsidising passenger fares by reducing the Fuel Adjustment Component (FAC) from possible earnings made by operating premier trains on the dynamic pricing formula.

Since January last year, the Railways started to levy the FAC on passenger fares to offset the annual fuel subsidy burden of Rs. 3300 crore.

“The railways minister can offer to reduce this financial burden on passengers by promising to make the rich passengers pay for the poor,” sources said.

“The railways minister, however, will not bring about any reduction in the basic passenger fares,” sources said. 

Late last year, the Railways introduced the dynamic system on one train on the Delhi-Mumbai route – with the experiment having shown encouraging results. Plans for the launch of 20 additional premier trains are likely to be announced by Kharge on routes connecting Mumbai-Amritsar; Pune-Howrah and Pune-Patna.

The railways minister will also seek funding approval for three new line projects in four politically important states including his home state of Karnataka. These include the 252.50 km long Gadag Wadi new line costing Rs. 1922.14 crore in the South Western Railways; the 97.17 km long Pir Painti-Jasidih like costing Rs. 915.96 crore and the 165 Km line to connect Ajmer-Nasirabad and Sawai Madhopur at a cost of Rs. 873.71 crore in the North Western Railways.

New Line projects are usually not announced in interim budgets. “These projects are unlikely to create any controversy, since they were announced in earlier budgets”, an official said.


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