Indian Railways Will Invite Private Firms To Clean Stations, Low-Demand Trains Will Be Reduced To Save Money
Indian Railways have been up to news since some time now and all for different reason. Right from redeveloping new stations, to the very hyped ongoing IPO offerings. Amidst all this commotion surrounding the Indian Railways, there has been hovering a shortfall of nearly Rs 30,000 crore upon the subject.
In order to cut down these losses and buck up, the Railway Board has considered several measures which it has demanded to bring into action immediately and in short-term, which it confirmed in its letter dated September 6, to 17 of its zonal units.
How Deep is the Shortfall?
The figures out at August end speak that the Railways are already way over their spending. Even though its earnings have grown by about 3.4%, its expenses too have spurted up by 9% this fiscal.
As per the officials, the August earnings dropped due to unprecedented floods that led to a steep decrease in coal loading. The immediate focus is to raise about Rs 5,000 crore of savings, as that’s the amount that has been spent “off-budget” already.
From April to August this year, Railways faced a shortfall in earnings, while its expenditure rose.
- The earnings from passengers have a shortfall against the budgeted target of around Rs 11,852 crore.
- Freight loading fell short by 10 million tonnes as per the budgeted target of Rs 8,600 crore.
- This is partly due to advance freight of Rs 13,000 crore taken from NTPC last year, which means Rs 8,200 crore is to be adjusted in the current year.
- The reight earnings have grown by only 2.8%, while it was to grow over 12% this year for budget calculations to fit.
- Expenditure wise, Railways had budgeted ordinary working expenses at around Rs 1,55,000 crore this fiscal.
- However, it spent Rs 68,000 crore by August-end, which is around Rs 1,800 crore more than what was expected.
Steps Proposed by Railways to Make Up for the Losses
Some of the measures proposed by the Board to reduce expenditure and increase earnings are:
- get cleaning of trains and stations done through sponsorship and Corporate Social Responsibility
- review trains with less than 50% occupancy and decrease their frequency or merge them
- get repair of staff quarters done by monetising Railways’ land
- retire diesel engines which are over 30 years old to save fuel
- save fuel cost by implementing better practices
- optimise maintenance practices and rework operations for better earnings.