Indian Railways has a mission to improve revenue and continue to remain affordable for general coaches as it gears up to mitigate losses in passenger segment.

The parliamentary standing committee on railways noted that the need to review fares of Air-Conditioned (AC) coaches has arisen due to loss in revenue from the passenger segment than from freight segment. This has an impact on various aspects of Indian Railways.

Noting in its first report on demand for grants (2024-25), the standing committee on Railways estimated a revenue of Rs 80,000 crore for passenger segment as against Rs 1.8 lakh crore from freight. “Net revenue of Indian Railways has been negligible for the year 2022–23 and 2023–24. Further, the budget estimate of Net Revenue for the year 2024–25 has been kept at Rs 2,800 crores,” the report observed.

The report emphasised on the importance of increasing revenue from the passenger segment for Railways for which it suggested a review of fares across classes. The standing committee, headed by BJP MP CM Ramesh, also suggested that to cut losses, AC class fares should be in line with operating expenses.

However, the Indian Railways is committed to maintain the affordability for general classes as it noted that it remains the most useful means of transportation for crores of passengers across the country and simultaneously enhance the cost by reviewing its operating costs for passenger trains.

Committee’s observation

The committee has given various recommendations to lessen the financial burden and improve revenue sources. It suggested doing away with catering services and instead introducing high-standard food at competing prices as it observed incompetence in the catering section.

On the other hand, the railway ministry made clear that concessions as high as Rs 56,993 crore every year that also constitute a discount of 46% on each ticket make it difficult to offer concessions to senior citizens.

“Additionally, there should be consistent engagement with state governments at the highest levels to address land related issues and guarantee timely acquisition of land. Indian Railways may also enlist the assistance of local Members of Parliament to facilitate coordination with state governments for efficient and timely land acquisition,” it also said.

The committee has pressed on the need for a big overhaul of Indian Railways in order to modernise it. For this, it has opined need for huge capital investment and ordered Ministry of Railways to explore options of more participation of private sector for its involvement in investing in railways infrastructure.

Source : DNA India