DoPT clears way for tariff regulatory body for Indian Railways

DoPT laid down the terms and conditions for setting up the long-awaited tariff regulatory body

The Department of Personnel and Training (DoPT) has finally laid down the terms and conditions for setting up the long-awaited tariff regulatory body for the railways, a senior railway official told PTI.

The Union cabinet had, in April, approved the setting up of the tariff regulator for the Indian Railways, the Rail Development Authority (RDA), and with the DoPT's approval, it can now issue advertisements for appointing a chairman and the board members.

The DoPT has conveyed to the ministry that the RDA chairman will get Rs 4.5 lakh per month as consolidated salary, while each members will get Rs 4 lakh, the official said.

With the remuneration decided, the ministry can now issue advertisements for the posts, after which a selection committee, headed by the cabinet secretary, will finalise the suitable candidates.

The process is likely to be completed by the year-end, officials said.

The tariff regulator, the need for which was stressed by Railway Minister Suresh Prabhu in his 2015-16 budget speech, has the mandate to take all the decisions regarding pricing of tickets, suggest measures for the enhancement of non-fare revenues and create an investment-friendly environment.

It was being touted as a big ticket reform which would de-link tariff determination from the politics of the day, said senior officials.

Sources in the ministry said an independent regulatory body would ensure competitive pricing, based on market dynamics and not on political exigencies, which made successive railway ministers refuse tariff hikes.

In fact, the loss of the railways in the passenger business is currently around Rs 34,000 crore a year, which the regulator will aim to mitigate.

Several committees on the railways had also suggested such a body with the most recent suggestion made by the Bibek Debroy Committee in 2015.

The RDA chairman and the members will have a fixed term of five years and can only be removed by the Centre on certain grounds, including insolvency, conviction by a court, misbehaviour, physical and mental incapability.