The cash-strapped Indian Railways could see a hike in passenger fares and freight charges. The announcement is likely to be made by railway minister DV Sadananda Gowda in his maiden budget speech next month.
Among the proposals in the pipeline include a 14.5% hike in passenger fares and a 6.5% increase in freight rates besides setting up of a new corpus to undertake passenger safety related works.
A final decision would be taken this week after the railway minister’s meeting with Prime Minister Narendra Modi it was announced by Gowda on Monday following a pre-budgetary meeting with finance minister Arun Jaitley wherein the railway minister sought an enhanced central financial assistance to the railways by way of gross budgetary support (GBS).
“Innovative methods to raise additional funds by permitting foreign direct investment (FDI) or by taking the public private partnership (PPP) route and through the floating of bonds are being considered,” Gowda told a group of journalists at Rail Bhawan.
High-speed trains coming soon
Presenting the interim rail budget in March this year, Gowda’s predecessor M Mallikarjun Kharge had factored in an across the board 10% hike in passenger fares besides an additional 4.5% raise as fuel adjustment component (FAC) and an increase of freight charges of 6.5%.
At a recent meeting with railway board officials, Gowda is understood to have agreed to the proposals.
“But no decision in the matter has been taken,” the railway minister asserted.
Figuring high on Gowda’s agenda are plans to build high speed corridors and to accord greater priority and funding to central rail projects in Jammu and Kashmir and the North Eastern states.
The exercise of reviewing the long list of pending projects worth over Rs. 1.50 lakh crore — with the possible intention of scrapping some unviable ones that have been bleeding the railways — has also been initiated by Gowda.
“The ongoing and last mile projects need greater priority,” he said.