House panel moots ‘adjustment’ of passenger fares to boost railway revenues

A parliamentary committee has recommended that the Ministry of Railways should undertake “prudent adjustment” of passenger fares to reduce the burden on freight segment, while highlighting that the Railways’ operating ratio, which helps determine the financial health of the national carrier has regularly deteriorated after 2015-16.

The committee, in its report tabled in Parliament on Monday, also said the actual earnings of the Railways have fallen short of projected earnings for all years since 2016-17, indicating that either unrealistic projections were made or the Ministry’s efforts to actualise the accruals were not sufficient.

Noting that Railways’ revenues from passenger services have deteriorated due to suspension of operations during COVID-19, the panel, headed by former Union minister Radha Mohan Singh, has asked Railways to consider resuming passenger services keeping in view the protocol norms in various States to boost their revenues.

“…the tariff policy of the Indian Railways has traditionally followed the principle of cross subsidisation in order to offset the losses incurred in the heavily subsidised passenger and other coaching services through additional revenue from freight movement

The Hindu
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