The Prime Minister dedicated the 760 km Konkan Railway project to the nation yesterday. While the officials concerned are being showered with plaudits there seems little to rejoice about. The line was built to take 28 trains a day, most of them freight carriers. Now guess how many trains run on this four-month-old Roha-to-Mangalore route? Just eight passenger trains that too not everyday. Freight trains are even rarer.
The cynics, of course, would say this controversial line is only living up to the predictions; it was fated to be a ghost track from the start. But the high-profile Konkan Railway has cost the exchequer Rs 3,400 crore so far to build and carried traffic projections that seemed to defy the doubters (see table) and environmental protesters. So why this performance?
The answer seems to point to a battle between the Indian Railways and its 51 per cent subsidiary, the Konkan Railway Corporation (KRCL), the remaining shares are owned by the state governments of Maharashtra, Karnataka, Kerala and Goa.
Konkan Railway officials have a specific story to tell. And most of their complaints centre on what they consider wilful neglect. The issue: that the Railways is unwilling to forego revenue by diverting trains from earlier circuitous routes to the Konkan railway, which reduces the distance between Mumbai and Mangalore by 1,127 km and the time by 26 hours.
Their immediate evidence runs like this. One, the line was ready on January 15 but was not inaugurated till January 25. Two, the first train to run on the line the Netravati Express started only two months later on March 21 and the new Rajdhani from Delhi to Trivandrum was flagged off only this month.
All this talk about shifting trains to the Konkan line is nothing but hot air from Railway Board officials, fumes an official associated with the project.
The Indian Railways public relations department denies all this. How can you say Indian Railways is being step-motherly towards the Konkan Railway Corporation? After all, we funded the corporation and have a 51 per cent stake in it, counters an official in the PR department.
Confronted with specific questions, officials in the traffic segment of the Railway Board have an explanation of sorts. We are looking into the matter. Only those trains that incur operating costs that are lower or the same as those running on the longer route will be shifted to the Konkan line. The Indian Railways, Konkan Railway Corporation and the parties whose traffic we carry are engaged in talks at the moment, says one official.
Konkan railway officials suggest there is no need for discussion in the first place. After all, the main reason for building the Konkan railway was to allow foodgrain and fertiliser to travel a shorter distance to the south west. For instance, before the Konkan railway, foodgrain from Delhi could only reach Mangalore via Andhra and Tamil Nadu. This took roughly 3,833 km and five to six days.
With the Konkan railway, foodgrain from the northern mandis can reach Mangalore in three to four days. Similarly, for transporting fertiliser from the north-western region to the south, time and distance would be reduced. And since the Railways always charges users for the shortest route, it made sense to divert traffic to the Konkan railway. In fact, the Railways was expected to divert seven foodgrain freight trains a day and some fertiliser carriers to the Konkan Railway.
The Railway Board official explains why this hasnt happened. With the import of foodgrains and the current problems with the fertiliser pricing policy, traffic for the Konkan railway looks bleak.
Konkan Railway officials counter that the real reason was that the Railways was worried about losing revenue. Foodgrain from Delhi to Mangalore via the Konkan Railway would be 780-odd km shorter. Since the Railways charges tariffs on distance, this would not only translate into a substantial revenue loss but also involve paying the Konkan Railway Corporation for use of that stretch.
The Railways initial explanation was that it needed to meet its revenue and traffic targets for fiscal 1997. But this deadline now seems to have been extended to the new fiscal year as well.
Railway officials now suggest that Konkan Railway Corporation, which was set up to implement the project on a build, operate and transfer basis, should perhaps start trying to create its own traffic rather than depend on its parent. They lacked aggression in marketing themselves when the line was under construction, says the board official.
This is a valid point, but building a traffic base will take time for several reasons. One, industry is yet to be established in the Konkan region. Two, the infrastructure sector in India has always been plagued by the free-rider problem that is, no one wants to pay for the project but at the same time.everyone wants to enjoy its benefits. No public or private sector unit was willing to commit traffic before the line was built. So this ruled out the question of Konkan Railways attracting traffic when the line was being constructed.
Railway officials say Konkan Railway Corporation could attract more traffic than it does presently and in the future if it waived the 50 per cent distance surcharge that is allowed to all new railway lines. Cheaper fares are the order of the day, reasons the board member.
Konkan Railway officials say this is a specious argument. Economic rationale, they argue, suggests that consumers would take into consideration economic costs and not just the travel and freight carrying charges. Therefore the economic costs in terms of time and distance saved and comfort and convenience for passengers would be too high to be overlooked.
Resolving this tussle between the Railways and its subsidiary could be tough because of the managerial structure of the two corporations. Chairman, Railway Board is also the chairman of the Konkan Railway Corporation. This was done to ensure the Railways commitment to the project. Which means if Konkan Railway Corporation managing director B Rajaram were to complain about the Indian Railways, he would, in effect, be embarrassing his own chairman.
But the controversy has larger implications for infrastructure-starved India in which private investment is set to play a larger role. And the success of schemes like build, operate, transfer (BOT) and its variations (BOOT and BOLT) are crucial to this development. If more BOT schemes are to be promoted by the funds-starved Railways, which is clearly on the private participation track, Konkan Railways predicament can hardly be called a propitious start.
