Premium trains must be appreciated: R N Malhotra

No big-ticket announcements have been made in this Railway Budget, as it was a vote-on-account. Broadly, the ministry has only elaborated the steps already taken. The only significant announcement is the introduction of 17 premium trains and 38 express trains. Also, the government has budgeted for a five per cent increase in freight loading next year, against a 4.2 per cent increase in freight traffic this financial year.

The increase in freight traffic is directly proportional to gross domestic product (GDP) growth. The five per cent increase is also in line with GDP growth projections. However, this will not give the Railways enough revenue to offset losses in the passenger segment.

The ministry is budgeting for an operating ratio of about 90 per cent, clearly not sufficient to carry out developmental activities. For instance, the annual Plan outlay for 2014-15 has been envisaged at Rs 64,305 crore, only 1.6 per cent more than the budgeted annual Plan outlay last year. To a significant extent, this will be offset by inflationary pressure. In effect, it will be less than even last year's Rs 63,000 crore.

Though the ministry has promised new trains, there are no new projects. It has only announced annual surveys for a few projects.

The announcement of premium trains is a step in the right direction. These trains compete against air traffic and captures those who have higher paying capacity, but have to travel on a short notice. The move to leave prices unchanged is not a surprise. Neither passenger fares not freight rates are raised in a vote-on-account.