Railways blueprint confirms its fears: Air travel will be No. 1 choice in three years

The blueprint analyses government statistics to show that 25 per cent of domestic air travel happens over inter-city distances within 500 km — a segment where the Railways was always believed to enjoy a monopoly — contrary to popular perception that air travel is chosen only for 800-1,000-km distances.

Written by Avishek G Dastidar | New Delhi | Updated: July 25, 2017 10:00 am
indian railways, air travel, railway minister, railway blueprint, domestic airlines, long distance travel, indian express (Illustration: Mithun)

A blueprint prepared by the Railways has just confirmed its worst fear: within the next three years, domestic airlines will overtake it as India’s most preferred mode of long-distance travel for upper-class passengers. The projection for 2019-2020 is detailed in a blueprint on the future business scenario prepared by the Railway Ministry, raising the first official red flag over the national transporter losing its upper-class clientele to the booming domestic airlines sector.

While speed has traditionally provided the edge for airlines, “price” has now given them a complementary advantage, says the blueprint, which warns that these two factors need to be taken up on an urgent basis.

The blueprint analyses government statistics to show that 25 per cent of domestic air travel happens over inter-city distances within 500 km — a segment where the Railways was always believed to enjoy a monopoly — contrary to popular perception that air travel is chosen only for 800-1,000-km distances.

”It is essential that Indian Railways addresses the two key value propositions of airlines passenger business — price and speed — immediately to sustain its core business in the passenger segment in the future,” it says.

This should serve as a “wake up call”, and require clear cut strategies on pricing and capacity augmentation, it says.
The blueprint is part of an internal assessment report commissioned by Railway Minister Suresh Prabhu and prepared by the Railway Board to map a comprehensive overhaul and possible course correction.

”With the proliferation of airports into small towns and massive thrust of low-cost airlines to Tier-II and III cities, there is a clear pattern emerging of air being preferred for even shorter hauls by passengers,” it says.

Apart from airfares coming closer to rail fares, proactive government policies like UDAAN, which provides for air travel of less than an hour for Rs 2,500 will also provide impetus to the civil aviation sector, the blueprint concludes.

”This should be viewed as an overall healthy trend for the economy,” NITI Aayog member Bibek Debroy told The Indian Express. “For shorter distances, the Railways had started losing share to the road sector, and now for long-distance travel, civil aviation sector has been claiming its share. Eventually, multimodal transport development will happen seamlessly, and it will not be viewed as an either-or binary of road and air travel,” he says.

The number of total passengers carried by domestic airlines has been spiking towards the 100-million mark for the last few years. They carried around 97.8 million between December 2015 and November 2016, the report notes. The comparable classes on Indian Railways — First AC, AC-II, III and First Class — carry on an average 145 million passengers every year.

For Railways, this segment has been either shrinking or plateaued. From a growth of 9.5 per cent in 2014-15, it shrunk to 5.01 per cent in 2015-16, the report notes. ”The 20 per cent year-on-year growth of the civil aviation sector is likely to sustain in the short run-up to five years and then taper out to a 10 per cent average annual growth rate,” it says.

The report says that till Dedicated Freight Corridors are commissioned in full, the average growth rate of the upper class segment will remain a tepid five per cent. “…the number of passengers by air would exceed the upper class rail passenger numbers by FY 2019-20,” it says.

The Railways has been losing passengers in the up-to 100-km segment over the years prompting the Parliamentary Standing Committee to question it a couple of years ago. At the time, the Railways had attributed it to the proliferation of two-wheelers and improvement in rural road connectivity.

“For years, we have refused to see the writing on the wall. This is the global trend in developed economies, wherein the Railways do not serve long-distance passenger travel. That load is rightly taken by air,” says Ajay Shukla, former Railway Board Member (Traffic).

”Railways should ideally cede the market of long-distance services, like Delhi-Chennai and others to air and free up its own capacity for more freight trains, which will be a real contribution to the economy,” says Shukla.

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    Ramesh Chhabra
    Jul 26, 2017 at 7:20 am
    At present fares of Indian railway (may be equivalent/ more than air fares) are high. Passengers are automatically enjoying air travels in trains.
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      Sumit
      Jul 25, 2017 at 7:57 pm
      Indian railway must learn to know what a passenger needs. A passenger needs a ticket as his wish on the day of the travel or at least a week before but railways says booking for a sure seat must be done in one year/6/3 months in advance. Ridiculous. Who will plan to travel a 500 -1000 km distance in one year advance in these days? 2. Make the compartment modern, light and neat. 3. Make railways neat and free from any railway union activities or its posters. 4. Make trains available frequently. 5. Make ensure trains available in a busy route three to four times daily. Ensure foods supplied in the compartments must be neatly packed with almost in 100 international hygiene. Only these measures will improve its viability in future. Otherwise we may have time to keep trains in museum.
      Reply
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        Ramesh Chhabra
        Jul 26, 2017 at 7:15 am
        Indian railways is busy in earning cancellation/ reservation charges more than enough. Then why should they provide trains/ adding coaches/ taking care windows, etc.
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        sanjay pathak
        Jul 25, 2017 at 1:38 pm
        India needs bullet train,japan,china,france Spain etc lot of countries are running bullet train successfully,it can not beat Airlines in speed for long distance but in middle and short distance lot of passengers from cars,buses can use it as they cannot compete with bullet speed, USA,Canada etc who depends totally on Airlines and Highways are feeling need of bullet train now a days
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          rkannan
          Jul 25, 2017 at 12:03 pm
          Indian Railways rarely tries to understand its market. We needed high speed trains 20 -30 years ago but even now Railways is dragging its feet on this subject. In China, high speed trains run between 300 - 400 km /h effectively reducing the market for air travel by their fast, reliable, efficient and clean service. Indian Railways introduces new trains like Tejas which run at 19th century speeds and they advertise its touch screen and food service. If the trains ran fast, nobody needs entertainment or food. In the airline sector, Jet beat the competetion in the 90s by offering most on time performance. In the last decade, Indigo has become the leader by precisely this factor. Indigo offers no entertainment, food is charged and of poor quality, and its employees are often rude. It has become no 1 because it focused on speed and on time performance. when will Indian railways wake up to this need ?
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            M Shukla
            Jul 25, 2017 at 11:45 am
            The railways should speed up introduction of high speed trains of at least 200 kmph that can run on current infrastructure with minor upgradations. If required train-sets can be imported in government to government mode. India should be aware that airplane run on imported fuel while trains can run on electricity produced at home from abundantly available coal. Once the railways shut-down airlines will increase fare again.
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              Rahul
              Jul 25, 2017 at 11:40 am
              This is the results of lopsided development or inequalities of income. For any decent middle class family today traveling by train is scary because of safety and hygiene issue. And these two issues come up because of "cattle class" dominating the rail travel. Cattle class will not improve their low life values and criminal tendencies because of social and economic constraints. Hence middle and upper class will shun railways even if they have to s some extra money.
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                Manas Sarkar
                Jul 25, 2017 at 10:47 am
                What's the problem in it? That reduce load of railways. More and more people can travel sitting in train, which happens in most of countries. In India we pay less fare, also several times need to stand inside the train. For poor people, train always will b the best option. No need to fool people.
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                  p g
                  Jul 25, 2017 at 10:44 am
                  This will not happen. Only dreams. Effect, yes, but not much. Airlines are not doing well. Hence nothing to panic. Railways will only be the indians first choice to travel, all within budget.
                  Reply
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