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Railways is spending more than it's earning

Despite increased earnings, the Northern Railway ended up spending much more than it could earn in the last one year.

delhi Updated: Apr 16, 2011 00:39 IST
Avishek G Dastidar

Despite increased earnings, the Northern Railway ended up spending much more than it could earn in the last one year.

In fact, with a precarious operating ratio of 112.74% - which essentially means for every Rs100 earned, it ended up spending around Rs112 - the financial health of this zonal railway is a reflection of its parent body (the Indian Railways) whose coffers have been dwindling for some time now.

The Railways' quarterly budgetary allocation has been higher than the actual funds available to it.

Northern Railway, which earns most of its money by carrying passengers and not so much goods, ran a record number of trains last year.

In 2010, it ran 6,265 special (temporary) trains, mostly long-distance ones, to accommodate growing passengers during the holiday season and festivals.

These trains originated from various parts of its network, mostly Delhi, and set the cash registers ringing.

Officials said that the growing population has created demand at various times of the year, which necessitated the running of special trains.

"Today, an average family travels much more than, say, a decade or so ago. That reflects in the number of trains we have to introduce on a temporary basis every year," said Manish Tewari, Northern Railway spokesperson.

"On top of that, we have also augmented the capacity of regular trains by adding extra coaches to them. All this has resulted in increased earnings," Tewari added.

Between April 2010 and February 2011, the earnings of Northern Railway increased by 7.44% more than during the same period last year.

Its earnings from 'coaching' alone increased by 9.25%.

But the finances of the Railways have been on a downswing for months now.

In fact, Railway contractors have been queuing up for payments for the goods and services rendered.

Sources said several payments were deferred due to lack of finances in the last quarter, which ended this year in March.