Railways to stop footing bill on passenger travel concessions

NEW DELHI:The cash-strapped Indian Railways has decided to stop footing the bill for myriad passenger travel concessions, a top official said. “We provide more than 50 concessions as a part of social service obligation, incurring huge losses every year. We are not saying concessions shouldn’t be extended to the needy but the concerned ministries should be reimbursing us for the burden of these concessions,” said a senior Railway Ministry official.

A white paper says the social obligation cost ‘impinges upon viability’ of the Railways. File Photo

Every year, Indian Railways loses about Rs.1,500 crore in providing 53 such concessions, including those for senior citizens, differently-abled and patients.

Senior citizens
According to the Railway Ministry, the financial burden should be borne by the ministries concerned such as social justice for senior citizens, home affairs for freedom fighters and so on, the official said. The Parliamentary Affairs Ministry already pays the full ticket fares for Members of Parliament travelling on railway concession passes, for instance, he pointed out.

Of the total loss of Rs.1,500 crore on passenger fare concessions, the largest chunk of about Rs.1,000 crore is accounted for by subsidies for senior citizens, he said.

While male senior citizens can avail 40 per cent reduction on ticket fares, female passengers get 50 per cent discount.

This concession is provided across all passenger classes and trains, including in services like Rajdhani, Shatabdi, Jan Shatabdi and Duronto.

Coaching services
In 2015-16, the loss on coaching services, including suburban and non-suburban passenger traffic, luggage and parcels stood at Rs.34,030 crore.

Further, the Railways spent Rs.76 crore for carrying essential commodities such as fruits and vegetables at below cost in a bid to contain their prices.

“This is no more sustainable. Our revenue from passenger segment is around Rs.45,000 crore and we incur around Rs.34,000 crore as losses towards social service obligations.

We are focussing on how we can trim this loss as we should be earning around Rs.90,000 crore from passenger operations in total,” said the official.

Earnings target
For 2016-17, the Railways has set a target to grow passenger earnings by 12.4 per cent to Rs.51,012 crore.

The official said that a few meetings had already been held on the issue and the Railways Ministry will soon write to other ministries requesting them to reimburse the concessions.

A white paper on Indian Railways released by the government in February 2015 had said that the social obligation cost “impinges upon the viability” of the Railways network.

Posted by on June 3, 2016. Filed under Economy. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.