Railways keeps up operating ratio despite Covid-19 losses

“Railways’ operating ratio is expected to improve by end of the current financial year to 96.96%, despite the disruption caused due to Covid-19,” Railway Board member (finance), Naresh Salecha said on Monday.

Indian Railways has been able to maintain an operating ratio, its operating expenses as a percentage of revenues, of 96.15 % in the current financial year despite a loss of passenger traffic during the lockdown clamped in the aftermath of Covid-19.

Indian Railways’ massive pension bill of more than ₹51,000 crore in the current financial year has been converted into a loan by the finance ministry. (HT Photo)

This means the national transporter was able to lower its expenditure and make up for the shortfall in traffic through revenue generated by freight operations. A fall in pension liabilities also helped; Indian Railways’ massive pension bill of more than ₹51,000 crore in the current financial year has been converted into a loan by the finance ministry.

“Railways’ operating ratio is expected to improve by end of the current financial year to 96.96%, despite the disruption caused due to Covid-19,” Railway Board member (finance), Naresh Salecha said on Monday. This is lower than the revised estimate of 98.36% for 2019-20. Passenger traffic was suspended during the lockdown imposed on March 25; select passenger trains resumed in the middle of May.

“Pension liability was budgeted at ₹53,160 crore in the beginning of the current fiscal. However, the revised estimate stood at ₹623 crore as the national transporter made an arrangement with the finance ministry to defer this expense,” Salecha said.