Rlys: Baalu panel calls for more funds

It is learnt that Baalu has conveyed that the Railways is in red and has made a strong case for Central fund.

Written by Avishek G Dastidar | New Delhi | Published:February 22, 2012 12:48 am

The pressure on the government to bail out the Indian Railways in the forthcoming Budget has increased as T R Baalu,the chairman of the Parliamentary Standing Committee on Railways,has written to the Prime Minister and Finance Minister arguing for an increased budgetary support for the national transporter.

It is learnt that Baalu has conveyed that the Railways is in red and has made a strong case for Central fund.

Unlike several committees and the Planning Commission,which have been advocating a revision in fares to save the Railways,Baalu’s letter does not touch upon the subject. Sources said it instead calls for infusion of more funds from the Central coffers,which already allocates Rs 20,000 crore per year to the Railways on account of certain socially desirable — but economically unviable — subsidies. The letter,however,does not specify any amount.

While Railway Minister Dinesh Trivedi has been vocal regarding the need for funds as a sort of “bail out” in the lines of the government’s “package” to Air India,the pressure from a parliamentary panel adds more muscle to the demand. Sources in the Railway Ministry said that the demand for more outlay gets a major boost with the request from the Standing Committee Chairman,who is also a leader of the DMK which is the largest constituent of the ruling UPA-II coalition.

“The cost of new works,rolling out new trains and all new projects is escalating. Things are extremely difficult without the necessary funds. It is true we need to generate funds on our own,which we are trying. But that alone is not enough,” Trivedi told The Indian Express.

In his recent interactions with the Planning Commission and Finance Ministry officials,Trivedi is learnt to have highlighted that out of every rupee the Railways has,about 86 paise goes to fund the “fixed costs”,leaving about 14 paise for everything else. At present,the Railways is battling to bring down its operating ratio (money spent to earn every Rs 100; the lower the better) below 100.

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