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Railway Budget: Simply populist

The Railway Minister seems to have followed a populist approach rather than addressing the current woes plaguing the Railways. Despite the significant rise in prices of diesel, petroleum and petro-products during this fiscal year, the Railway minister has opted for a nominal 3% increase in the rates of all commodities except for the essential commodities like vegetables, fruits, edible oils, grains, kerosene, LPG etc. There is also no hike in passenger fares.

At the same time the dividend to be paid to the Government is lower by Rs 10 bn than the amount recommended by Railway Convention Committee. This will add to the existing woes of burgeoning fiscal deficit.

• No hike in passenger fares in any class and train.

• Freight rates for essential commodities left untouched

• 3% hike in freight rates on all items other than essential commodities.

• 2% increase in freights for coal (not meant for household consumption) and Iron & Steel

• Urea exempted from the hike

• No increase in Parcel and Luggage rates

• Freight traffic target fixed at 500 mn tons

• Passenger traffic targeted to grow at 9%.

• Net Railway revenue projected at Rs 16.83 bn

• Sundry earnings estimated at Rs 17.17 bn

• Dividend to be paid to Government lower than that recommended by the Railway Convention Committee by Rs 10 bn.

• No fresh new line project included in the budget.

ALSO READ:

The Rediff-Dun & Bradstreet Budget Impact Analysis
The Railway Budget 2001-2002
The Budget 2001-2002 Special
The Y2K Railway Budget
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