Rlys charge a bit more for freight, less for passengers: Prabhu

Railway MInister says capacity creation will improve services, lower costs and boost Railways' competitiveness

Railway freight earnings are utilised to cross-subsidise passenger business, thus making passenger services available at affordable prices to the common man, Lok Sabha was informed today.

"The Railways overcharge a little more in freight rates and charge a little less in passenger fares," Railway Minister Suresh Prabhu said during question hour.

He said the decision to choose a mode of freight transport depends on several factors, freight rates being only one of those.

The Minister said capacity creation would enable Railways to provide better services at lower costs and enhance its competitiveness vis-a-vis other modes of transport.

"Railways realise that they need to tap additional funds to supplement resources forthcoming from budgetary support and internal generation if the network has to be expanded and decongested," he said.

Prabhu said a beginning has been made in the Railway Budget 2015-16 where Railways have announced its intention to invest Rs 8.5 lakh crore in the next five years through raising of resources from multilateral development banks and pension funds, in addition to existing sources.

"In addition, Railways have also undertaken immediate short term measures like freight incentive schemes, automatic empty flow rebate, improving throughput per train, running longer trains etc.," he said.

The Minister said schemes for attracting private investment in wagons and terminals have also been put in place. It is expected that these short and long term measures would enable the Railways regain market share in both passenger and freight segments in the years ahead.