The year 2019 was a roller coaster ride for different sectors of the economy, with jittery output and growth.
There is helping hand for companies, as the railways may cut freight rates in a bid to boost economic growth, besides “rationalising” passenger fares. However, Railway Board Chairman V K Yadav refused to say if passenger fares would see an increase, but hinted that freight rates might be reduced.
Here’s what he said on Thursday, December 26, and I quote, “We are going to rationalise the fares and freight rates. Something is being thought about. I cannot divulge more as this is a sensitive subject. While freight fares are already high, our target is to draw more traffic from road to railways in this regard.”
Fares were last increased in June 2014, soon after the Narendra Modi government came to power. At that time, both passenger fares and freight were hiked by 14.2 per cent and 6.5 per cent, respectively.
And just about a month ago, the railways had announced an extension to another major initiative to raise earnings — the flexi fare scheme — by a period of one year till March 2021.
Speaking of flexi fare, the scheme was launched in September 2016 and is applicable on premium train categories like the long-distance Rajdhani and Duranto expresses as well as Shatabdi Expresses that ply on shorter routes.
In July, while replying to a question in the Lok Sabha on rising train fares, Railway Minister Piyush Goyal had said: “Flexi fare is applicable to only 141 number of trains out of 13,452 trains as on date and in only AC 2 Tier, AC 3 Tier, AC chair car, sleeper and second class (reserved).Out of these 141 trains, flexi fare is applicable in 32 trains for nine months only.”
Goyal also said that alternative train services on normal fare structure are available on routes of Rajdhani, Shatabdi and Duronto trains.
He also said that the scheme has generated additional earnings of Rs 2,426 crore since its introduction until June 2019.
In an attempt to boost freight traffic, railways had announced several incentives in September. These included deferring the levy of busy season charge, waiving the supplementary charges applicable to loading rakes, and introducing the round-trip charge on container traffic.
Among other sectors of the economy, the railways too has been hit hard by the economic slowdown, with earnings from passenger fares dropping significantly.
Speaking of data available on Rail Drishti, the national transporter’s publicly available monitoring platform, passenger earnings stood at Rs 40,415 crore in the April-December period of 2019-20. Passenger earnings stood at Rs 51,066 crore in 2018-19.
The Comptroller and Auditor General (CAG) in its report tabled in the recent Parliament session said the railways recorded an operating ratio of…To know more, listen to this podcast
Source: Business Standard