Fare hike in Indian Rail Budget looks remote

New Delhi: The Rail Budget to be presented on Wednesday may continue with the practice of not raising the fares and freight rates but the possibility of imposition of a safety cess may not be ruled out, at least on the higher class fares. As Trinamool Congress leader and Railway Minister Dinesh Trivedi rises to present his maiden budget he is expected to carry on with the practice of not tinkering with the second class fares like his predecessors, including TMC member and eastern Indian state of West Bengal`S CM Mamata Banerjee, over most part of the last decade.

There is speculation that the budget could bring in a safety cess following a recommendation by the Kakodkar Committee report which went into issues relating to safety over the huge railway network. The Committee had suggested a cess to realise money to the tune of Rs. 5,000 crore, to fund projects especially for safety upgradation of signalling and telecommunication systems.

As he does the tight ropewalk, Trivedi may also introduce a mechanism to provide cushion for meeting costs on account of any spike in fuel prices. There is a suggestion for introducing a fuel adjustment component (FAC) in the basic fare to insulate railways from fuel price hike. Railways shell out Rs 19,000 cr as part of its fuel expenditure to run its huge fleet of diesel locomotives adding to the total expenditure placed at Rs 70,000 cr in the current financial year.

Indications are that the Indian Railways have got only Rs 25,000 cr as gross budgetary support from government despite its demand of Rs 50,000 cr to tide over its financial crisis. Railways had got Rs 20,000 cr as GBS in the current fiscal. Trivedi could also spell out plans for internal generation of fund from additional resources like commercialisation of stations. Since railways have already increased the freight rate on March 6 for all commodities ahead of budget, there may be no further hike in any freight on goods, say highly-placed sources in the Ministry.

The budget would strive to allocate a substantial amount of fund for the depreciation reserve fund and safety fund which have suffered in recent years in the wake of railways focus on other priority areas. The Rail Budget could announce two new coach factories in Kolar in Karnataka and Kutch in Gujarat. Incidentally, both the Ministers of States for Railways K H Muniyappa and Bharatsinh Solank come from these two states. While the thrust of the Budget would be on upgradation of infrastructure on 19,000 km of trunk route, Trivedi could announce introduction of `train sets` for the busy Delhi-Mumbai corridor to reduce travel time.

A train set comprises single rake with locomotive and coaches attached together. The venture may take more than four years to fructify but the budget announcement will set the ball rolling. The Budget is expected to have a proposal for introducing bullet train for Rajasthan on Delhi-Jaipur-Jodhpur corridor. This corridor could be linked to the proposed Pune-Ahemedabad high speed corridor. Unlike previous years, less number of new passenger trains could be announced. Trivedi could announce some measures to improve passenger amenities including the catering service in trains and stations and proposals for manufacture of `green` toilets to improve on the current system.

Railway Minister is likely to unveil an action plan for upgradation of signalling and telecommunication system to prevent accidents. Installation of train protection warning system (TPWS) and In-cab signalling system are likely to be announced in the Rail Budget 2012-13. The budget will focus on manufacturing of modern LHB coaches as railways intends to replace all conventional coaches in all types of trains. There will also be proposals for manufacturing of high horse power (5500 HP) locomotives in the next fiscal. The Railways freight loading target of 993 million tons in the current financial year is unlikely to be met, according to available indications. Till February, the national transporter has carried 875.60 MT.