Union Rail Budget 2014-15: Highlights

Union Rail Budget 2014-15 was presented by the Union Railway Minister Sadanand Gowda on 8 July 2014. This is the first rail budget presented by any Bharatiya Janata Party (BJP) minister and it is also Gowda’s first rail budget.

Highlights of Union Rail Budget 2014-15
• Railways to build FOB and escalators, toilets on all stations
• Railways also proposes to set up Food Courts at major stations
• RO drinking water facilities to be installed at stations
• Separate housekeeping wing at 50 major stations
• CCTV to monitor cleanliness activities
• Mechanized laundry will be introduced
• Dedicated freight corridor on Eastern and Western corridors
• Tourist trains to be introduced to link all major places of tourist interests across the country
• 4000 women constables to be recruited to ensure safety of women
• 17000 Railway Protection Force (RPF) constables to provide safety to passengers
• Setting up of Railway University for technical and non-technical study
• Ultrasonic Broken Rail Detection System (UBRD) to detect problem in track
• Proposal to start Bullet trains in Mumbai—Ahmedabad route
• Diamond Quadrilateral project of high speed trains to connect all major metros
• Efforts will be made to increase speed of trains to 160-200km/h on select sectors. The identified sectors are: Delhi-Agra; Delhi-Chandigarh; Delhi-Kanpur; Nagpur-Bilaspur; Mysore-Bengaluru-Chennai; Mumbai-Goa; Mumbai-Ahmedabad; Chennai-Hyderabad and Nagpur-Secunderabad.
• E-ticketing system to be improved. Future e-ticketing to support 7200 tickets per minute & to allow 120000 simultaneous users
• Wi-fi in A1 and A category stations and in select trains. Internet-based platform and unreserved tickets
• Will develop 10 metro stations with state-of-the-art facilities
• Outsourcing at 50 major stations; on board housekeeping to be extended to more trains; launching feedback service through IVRS on the quality
• Hospital Management Information System to integrate all railway health units and hospitals
• Special milk tanker trains to be introduced
• Temperature-controlled storage for fruits and vegetable
• setting up of Railway University for technical and non-technical subjects, tie-up with technical institutions
• Paperless office of Indian railways in 5 years. Digital reservation charts at stations
• Ready-to-eat meals to be introduced in phased manners
• New trains in Rail Budget: 5 Jansadharan, 5 Premium, 6 AC, 27 express trains, 8 passenger, 5 DEMU & 2 MEMU services; 11 train extensions
• Office-on-wheels: Internet and workstation facilities on select trains
• Temperature-controlled storage for fruits and vegetable

Some financial aspects of Railways in 2013-14
• Social obligation of Railways in 2013-14 was 20000 crore rupees
• Gross traffic receipts in 2013-14 was 1235558 crore rupees
• Operating ratio was 94 per cent.
• Spend 94 paisa of every rupee earned, leaving a surplus of only 6 paisa
• Gross Traffic Receipts were 139558 crore rupees 
• Total Working Expenses were 130321 crore rupees 
• Plan Outlay under budgetary sources was 35241 crore rupees

Rail Budget Estimates 2014-15
• Total receipts of 164374 crore rupees
• Total expenditure at 149176 crore rupees
• Earnings from Freight Traffic are estimated at 105770 crore rupees 
• Earnings from Passenger Traffic 44645 crore rupees    
• Plan outlay under budgetary sources 47650 crore rupees
• Additional Budgetary Support (ABS) of 1100 crore rupees as Capital
• Railways Share from diesel cess at 273 crore rupees for important Road Safety works

Resource Mobilisation
• Leveraging Railway PSU Resources
• Private investment in Rail Infrastructure through Domestic and Foreign Direct Investment (FDI)
• Public Private Partnership

In tiatives for Resource Mobilisation
• Near Plan Holiday approach
• Prioritizing and setting timelines for completion of the ongoing projects
• Decision Support System for project implementation
• Aggressive indigenization of imported products
• Adopting safety standards matching international practices and setting up of Simulation Center to study causes of accidents
• Encouraging development of Locomotives, Coaches and Wagon Leasing Market

Analysis
Railways are a microcosm of India on the move. With 12500 trains, railways move 23 million passengers every day; equivalent to moving Australia's population. Thus, extending passenger-friendly services shall be the main motive of any reforms.
Besides, Railways is also the carrier of bulk goods but it suffers from host of infrastructural and logistics issues. Hence, the Rail Budget target is to become the largest freight carrier in the world.

Indian Railways spent 41000 crore rupees on laying of 3700 km of new lines in last 10 years. A tardy progress and Railways need immediate course correction. Hence the Rail Budget 2014-15 focuses is on project completion rather than project announcements. 
From above it can be discerned that Railways is in dire financial crunch. As per Interim Rail Budget 2014-15, Railways are in losses to the tune of 26000 crore rupees. Earlier in June 2014 Narendra Modi-led government increased railway passenger fares by 14.2 percent and freight carriage charges by 6.5 percent.

However, there is need to explore alternative sources of resource mobilisation and not depend on fare hike alone. This is because although fare revision will bring in 8000 crore rupees but an additional 9 lakh crore rupees alone needed for golden quadrilateral project. 5 lakh crore rupees is required for ongoing projects alone over the next 10 years.
In sum, the Rail Budget tries to balance social and commercial obligations.