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February 26, 2002

‘23’

HIGHLIGHTS OF RAILWAY BUDGET, 2002-03

Introduction

Review of Financial Performance 2001-02

Economic slowdown reflected in freight loading reducing the freight earnings by Rs.625 cr.

Passenger earnings target of Rs. 11387 cr likely to be achieved.
Position of Railway dues, including those from State Electricity Boards/Power Houses continues to be unsatisfactory, standing at Rs. 3014 cr to end December 2001;
Instead of budgeted clearance of Rs 750 cr in traffic suspense, accretion of Rs 50 cr likely during the year.
With continued emphasis on reduction in expenditure, savings of Rs.1090 cr in Ordinary Working Expenses.
Considerable shortfall in non traditional sources of earning – ‘nil’ from RailTel .
Additional budgetary support of Rs.898 cr received for acceleration of selected projects during the year.
Total plan expenditure, including SRSF stands at Rs. 10857 cr as per Revised Estimates.

Safety

Special Railway Safety Fund set up during the year.
Replacement /renewal of overaged assets within five to six year time frame through this Fund – total cost Rs.17,000 cr.
Supplementary grant of Rs. 1400 cr under SRSF obtained in December 2001.
Green Book (2001-02) presented to Parliament.
With this work under SRSF commences.

Security

Proposal to amend RPF Act and Railway Act, with a view to empowering RPF under consideration.

Policy Initiatives during the year.

Increased autonomy to General Managers.
De-centralisation of procurement
Port connectivity through cost sharing either fully or in part.
Cost sharing for suburban systems at major metros.
MOU signed with Jharkand – Govt. of Jharkand to bear two-thirds of the cost of projects in that State.
Similar agreement with Government of Karnataka for certain projects on the anvil.
MOU signed with NTPC to explore possibility of captive Thermal Power Plants.
Pilot projects for private terminals and warehousing facilities near rail terminals.
Railways to introduce high speed refrigerated parcel vans to move perishables across the country.

Projects

Capacity on the saturated golden quadrilateral and its diagonals to be augmented
Other sources of funding to be explored
Allocation of funds for Railway Projects in different states on a clear and transparent formula
Criteria includes the area of the state, the population and the throwforward of projects in states.
Weightage to these 3 criteria in the ratio 15%, 15% and 70% respectively.
Of funds available for projects, first allocation to works in the North East (10%), funds for MTP projects, mega bridges and Railway’s share of projects in which States have contributed a 2/3^rd share.
Rest distributed to various projects as per formula – transparently and fairly.
Priority to mega bridges – work on Bogibeel Bridge to commence during Bihu.
Udhampur-Katra and Qazigund-Baramulla sections to be completed in three years -funds to be provided as an additionality.
Ministry of Defence to fund new line between Kolayat & Phalodi and onging gauge conversion from Luni to Munabao.
No new projects would be included in the Budget without requisite clearances being available
214 route kms. of New Lines, 542 route kms. of Gauge Conversion, 250 kms of Doubling and 375 route kms. of Railway Electrification to be completed in 2002-03.

Sports

Passenger Amenities

To commemorate 150^th year of the Railways, 2002-03 declared ‘Passenger Amenities year’.
Railways to introduce new inter-city service called Jan Shatabdi Express – sixteen in 2002-03.
Pilot project for computer based Unreserved Ticketing System to be taken up.
PRS centres to cover all district head quarters – 150 terminals to be added across the country in 2002-03.
IRCTC to set up plants to package drinking water under brand name ‘Rail Neer’.
50 food plazas at various stations to be commissioned.
25 additional express trains to be introduced
Frequency of 14 pairs of trains being increased – Rajdhani train between Guwahati and New Delhi to run every day.
16 services to be extended.
Three new MEMU services to be introduced including circular MEMU service in Lucknow.
Seven new passenger trains to be introduced.

Annual Plan 2002-03

Including outlay of Rs.2210 cr on safety works, total Plan outlay Rs.12330 cr.
Fund received from General Exchequer Rs.5840 cr including Rs. 1350 cr. for S.R.S.F. and Rs.450 cr from Central Road fund to road safety works.
Market borrowings budgeted at Rs.3000 cr, internal generation to provide Rs.2630 cr and Safety Surcharge collection expected to be Rs.860 cr.
Thrust of Annual Plan is expansion and safety.

Budget Estimates, 2002-03.

Expected growth in traffic 21 million tonnes of freight, 4% increase in No. of passengers.
Ordinary Working Expenses budgeted at Rs.31,160 cr i.e., 7% increase over Revised Estimates, 2001-02.
Pensionary charges likely to be Rs.6,000 cr.
Dividend dues budgeted at Rs.2679 cr to be discharged in full.
Plan fund requirement fall short by Rs.1360 cr – to be covered through additional resource mobilisation.

Freight Rates

No across-the-board increase in freight rates – only rationalisation carried out.
Freight structure for base class rationalised to remove anomalies, resulting in marginal decrease at certain distances and minimal increase in certain others.
No. of classes reduced from 59 to 32.
Ratio of freight in highest class to lowest drops from 8 to 3.3.
25 anomalous classes abolished.
Commodities of common use such as Edible Salt, Fruits, Vegetables, Gur, Jaggery, Shakkar, certain items of Edible Oils, Food Grains, Pulses, Organic Manures, Urea, Fodder and Dry Grass are proposed to be carried at the lowest Class-90.
Impact expected to be minimal
Marginal increase in rates of coal, iron ore and raw material to steel plants.
Marginal reduction in case of Iron & Steel, Pig Iron, Cement and most petroleum products.
These modifications expected to yield additional revenue of Rs.450 cr
Suggestions that would be mutually beneficial to Railway and Industry would be considered.

Passenger Fares

Relativity index for Sleeper class (Mail/Express) to be increased from 155 to 160 and AC Chair Car from 300 to 350.
For AC First Class reduction in relativity index from 1440 to 1400 to make it more competitive with air travel.
No change in relativity index for other classes of travel
Minimum fare for Second Class (Mail/Express) to be increased from Rs.15 to Rs.16. At longer distances upto 341 kms. the increase ranges from Re.1 to Rs. 6.
Minimum fare for Second Class (Ord.) increases from Rs.3 to Rs.4. Maximum increase for any distance upto 100 kms. is only Rs.3. At certain distances fares would be lower by Re.1 to Rs.2 due to rationalisation.
The fares for distances beyond 100 km. for Second Class (Ordinary) will be fixed at 55 percent of the Second Class (Mail/Express) fares
Fares for Second Class MST to be fixed equivalent to fares for 15 single journeys by Second Class (Ord.)
No changes in :
System of charging for QST
Existing fare structure of Rajdhani & Shatabdi
Parcel and luggage rates including News Papers and magazines
Changes in passenger fares expected to yield additional Rs.910 cr.
All proposals to come into effect from 1.4.2002.