November 21, 2001

    Investment strategies of the Indian Railways should be based on the long-term need of the country while remaining solvent. The nation needs the railways to remain as a vibrant transport organisation, meeting both the infrastructure needs of the country as well as the aspirations of the people , said Shri Digvijay Singh, Minister of State for Railways while inaugurating a one-day Seminar on "Indian Railways in the Age of Liberalisation: Strategies for Investment and Restructuring" organised by Centre for Transport Research and Management,(C-TRAM), here today.

    Analysing the critical issues confronted by the Railways, the Minister stated that the release of Status Paper in 1998 and White Paper in 1999, were aimed at generating public debate on the status of the Indian Railways so that a consensus could be arrived at on the future role of this mammoth organisation. He added that the Railways will be able to come out soon with clear strategies for investment and restructuring once the official committee in the Railways examining the Rakesh Mohan Committee Report finalises its recommendations.

    Shri Digvijay Singh said that the major area of debate has been centered around the objective of the Railways functioning under the Government,- should it be a totally commercial organisation or should it be oriented totally towards public goods? He said that in a large country like country like India , where infrastructure services are yet to develop, it would not be prudent to make Railways a totally commercial organisation with profit as its prime motive. Shri Singh further added that right across our border, China is building lines right upto Tibet, opening the entire area for economic growth and development. Should India lag behind in taking the mighty reach of the Railways to the far-flung areas providing scope for mass transport of people and goods, he asked.

    Underlining that in any developing economy, a balanced view has to be taken on what is appropriate in the given circumstances, the Minister opined that the strategy for the Railways, should transcend narrow short term goals and look at the long term need of the country while remaining solvent. We have to carefully weigh the different forces pulling the organisation in different directions and arrive at the long term path for the organisation. This would necessarily involve compromises. Compromises have to be made in the larger interest of the public good, he said.

    In his Key-Note address, Member Traffic, Shri R.K.Thoopal said that the investment strategies of the Indian Railways require a total re-look. Business as usual approach in investments cannot be sustained. Describing the present situation as paradoxical, Shri Thoopal said that Railways which has the advantages of energy-efficiency, eco-friendliness and land use efficiency, should not be losing market share at all. The important question is whether our freights are comparable and competitive with the road? he asked and added that the Indian Railways do not pass this test. Unless the Railways bring down its cost and deliver services cheaper than its competitors on the road, the future for is bleak, he cautioned. He concluded that the right approach is to simultaneously prepare the countrymen for the eventual correction of the distortion and to go all out to explore innovative ways of maximising revenue and controlling costs so that the pain of adjustment is alleviated.

    Earlier, in his Presidential address, Member Staff, Railway Board, Shri M.C.Srivastava said that there is a need for clear understanding of the roles of the Railways vis-à-vis the State in developing rail infrastructure. Railways could only act as executors of the projects, while the States has to act not only as a facilitator but as an active participant and promoter in case of railways for the initial investment whereafter the railways have to own, maintain and operate the system. Efforts could also be made to take assistance from private sector by giving them appropriate tax relief for investments made in such projects, he said.