The Railways are arteries for India.

So important is the Railways for India that we are the only country in the world to have a Railways-only budget, which was presented to the parliament yesterday. It has 63,000 kms of track, much of it built during British times to carry soldiers and to loot commodities, and carries 13 million passengers and 1.3 million tonnes of cargo everyday. The budget promises to improve services for passengers and looks forward to investing Rs 8.5 trillion over the next 4 years. The minister did not increase passenger fares but increased freight charges. Could more be done? Absolutely. We need to renew tracks, newer carriages, complete upgrade of stations and separate tracks for goods trains, to name a few, but that will need massive sums of money which the government does not have. There are many criticisms of the budget. One writer suggests that passenger fares should have been increased instead of freight charges because an average freight train earns a revenue of Rs 894 per km whereas an average passenger train loses Rs 385 per km. Trouble is that since independence the Railways have been run for its social obligations to the poor rather than as a commercial organisation. A white paper published by the ministry showed that of the Rs 17.19 billion spent on 88 " uneconomic branch lines " there was a loss of Rs 13.66 billion. The net social obligation last year was Rs 213.91 billion. Of the 40 uneconomic branch lines marked for closure only 15 could be closed because of fierce resistance from the public and politicians. 94.64% of the revenue is spent on the unreserved category, which cater to the poor, with a loss of 68%. This revenue loss for the poor is subsidised by higher fares on the reserved seats but there is a limit to how high the fares can go. With the cost of jet fuel tumbling, as a result of the fall in the price of crude, passengers, who pay higher fares, may switch to airlines with consequent loss of revenue. The Railways has 1.3 million employees and numbers can only be reduced by natural wastage as people retire. If the number of employees is to be reduced the Railways will need to be completely computerised which will need massive sums of money. What is puzzling is why the ministry does not utilise the extremely expensive real estate it owns. Stations are usually sited in the middle of towns and cities. Why not replace old station buildings with multi-storied buildings, in partnership with private capital, where space can be rented out to shops, offices and hotels? Privatising a monopoly will only result in increase in fares with poor service as the British experience has shown. But when a former Financial Commissioner for Railways calls it " incoherently packed " it is a bit rich. Why did you not carry out all that you suggest when you had the chance? Talk, after all, is cheap.