Jaitley defends move, says 'difficult but correct decision'

India must decide whether it wants a world-class railway or a ramshackled one: Jaitley

Defending the steep hike in railway passenger and freight rates as a ‘difficult but correct decision’, Finance Minister Arun Jaitley on Saturday said the railways could survive only if users paid for availing of facilities.

“The passenger services have been subsidised by the freight traffic. In recent years, even freight fares have come under pressure,” he said in his first reaction to the 14.2 per cent rise in passenger fares and 6.5 per cent increase in freight rates.

Stating the choice before the government was to allow the Railways to bleed and eventually walk into a debt trap or raise fares, Jaitley said, “India must decide whether it wants a world-class railway or a ramshackled one.”

“The railway minister has taken a difficult but a correct decision...The Indian Railways for the last few years has been running at a loss. The only way Railways can survive is when users pay for the facilities that they avail of.”

Jaitley, who will present the Union Budget next month, said a loss-making Railways would provide below-par services and would, eventually, not even have the resources to meet its expenditure.