Railways found profit in 2008’s air pocket
If 2008 was the Year of the Downturn, ‘India’s Lifeline’ Indian Railways managed to ride it out with élan. All thanks to skyrocketing airfares, reports Avishek G Dastidar.business Updated: Jan 11, 2009 00:19 IST
If 2008 was the Year of the Downturn, ‘India’s Lifeline’ Indian Railways managed to ride it out with élan. All thanks to skyrocketing airfares.
Believe it or not, there was a whopping 62 per cent increase in the number of ‘special’ (temporary) trains largely used by the holiday crowd run last year, over 2007.
Over all, Northern Railways carried 3.5 crore passengers during the year the highest-ever number from Delhi and the neighbouring region. The number of special trains run 7,000 is also a record.
Given the overwhelming number of bookings and long waiting lists for key destinations in Maharashtra, West Bengal, Bihar, Kerala and Karnataka, 12,000 extra coaches had to be deployed, up from around 8,000 in 2007.
At a time when the airlines reported cumulative losses of around Rs 4,000 crore, Northern Railways (NR) alone raked in additional earnings of Rs 507 crore. NR’s total revenue for the year touched Rs 3852.32 crore.
“In the middle of the year, demand for popular destinations like Goa, Kerala and Mumbai kept growing, and trains got overbooked quickly. That’s when we realised that a large chunk of the holiday crowd had shifted loyalty to the railways, as air travel had become prohibitively expensive. So, we increased the number of air-conditioned coaches in special trains, to make our offerings more attractive,” said a senior railway official.
It was mainly the holidaying families that opted for train travel last year, said the Travel Agents’ Association of India (TAAI). “For every increase of Rs 200 in airfares, 1 per cent of the business went to railways,” said Anil Kalsi of TAAI.
But industry experts predict that railways’ honeymoon with air-passengers may not last in 2009 as cash-strapped airlines are serenading their lost market with slashed fares.