Suresh Prabhu , the railway minister of India, is a good man who has been my colleague in the Atal Bihari Vajpayee cabinet. I congratulate him on presenting his maiden railway budget. The presentation of this year’s rail budget saw a marked departure from the past. The budget speech did not inform Parliament about last year’s financial performance in detail. In addition, there was no mention of a concrete action plan, time-bound priorities or targets. The most important objective for the Indian Railways today is to break away from the incremental story of the past and recognise the agenda of the future. The rail budget missed an ideal opportunity to lay out the agenda for the future in a concrete manner. Instead, it was a statement of lofty intent.
I say this from personal experience. While presenting the rail budget for 2001-02, I had stated that the railways “needs to develop a market-oriented and customer-friendly outlook”. The focus was to make the Indian Railways people-friendly through better management, safety standards, upkeep, innovations and response rate. A special railways safety fund of Rs 17,000 crore was created. This fund played a major role in upgrading and improving structures such as overhead bridges, thereby significantly raising safety levels. In 2002, the Indian Railways began producing Rail Neer to meet the need for clean drinking water.
Freight rates and passenger fares were rationalised. The catering system was transferred to the Indian Railway Catering and Tourism Corporation and transformed. For the first time, a policy to involve the private sector to increase the efficiency of the freight system was adopted. The year 2002 was dedicated to the rail traveller and declared the “passenger amenities year”, while 2003 was the “customer satisfaction year”. Innovative and customer-friendly measures to improve the ticketing system were incorporated in the next year’s rail budget. During my time as rail minister, an Anti Collision Device-based system was also introduced to enhance safety. Since 2001, the Indian Railways has shown a remarkable turnaround, without raising passenger fares, by improving the operating ratio. So more than positive intent, a well-defined action plan is necessary. This is where the rail budget for 2015-16 does not show adequate promise.
It depends far too much on debt from multilateral and bilateral agencies and the participation of private players. In the past, these attempts have not proved to be scalable. Investors often prefer developed states over poor ones. So, a plan that banks on outside lenders and investors could tilt the scale against poor and backward states, where investors do not have exposure. Further, the model of partnerships with the states is also not clear and rests on unsubstantiated assumptions. One such assumption is that the states have gained significant resources from the 14th Finance Commission award. I can state with much disappointment that Bihar, for one, might get less funds than before. When I was rail minister, we had developed and successfully implemented a participatory model under which the Indian Railways made partial contribution to specific projects proposed by the states, in accordance with their sectoral priority. This led to the successful completion of several projects across the country.
The Indian Railways is a living narrative of how India works. So, this narrative must tell the story of the nation. The plot of this story is contained in some simple questions. Do trains run on time? Is it safe to travel by train, especially for women? Are stations and trains hygienic? Do they have access to clean drinking water? Do people respect and value public property? Is the railways adequately responding to the passenger load? Is overall connectivity in the country increasing? The answers to such questions not only construct the narrative of the Indian Railways but also of life in India.
The roadmap of investments and infrastructure for the railways must account for these fundamental questions. In addition, it has to be futuristic. India is a young nation where people are constantly on the move for education, employment and other purposes. And they demand uninhibited digital connectivity, alongside fundamental guarantees of timeliness, safety, hygiene and accountability. These aspects also play a critical role in strengthening the professional and business environment in the country.
So what does the rail budget offer on these fronts? At best, a sketchy outline without a concrete plan. Let us take the case of timeliness. How does the budget address this issue? Informing passengers about train schedules and delays through SMS alerts and apps is a welcome step but it does not replace the need for trains to run on time. As for connectivity, the budget speaks about last mile projects. However, it does not commit to the time-bound completion of the various such projects that have been pending for a long time — including many critical ones in Bihar. Also, in the spirit of fairness, savings from reduced fuel costs should have been passed on to consumers.
The railways must leverage the comparative advantages of the states while developing a long-term roadmap. For example, Bihar is the greatest contributor to the workforce and is likely to remain so. The state is also poised to lead the second Green Revolution. However, the investment approach outlined in the rail budget does not adequately incorporate ways to build on these advantages. For instance, it would be a good idea to develop new education- and training-related institutions in states that have a large workforce and low institutional presence.
Summing up, the rail budget is incomplete. It is a proposal of intent at a time when the people of India are eagerly awaiting action, not merely a statement of purpose. The ability to transform intent into concrete action is what the nation wants — and what the NDA government has not delivered.
The writer, chief minister of Bihar, was Union railway minister 1998-99 and 2001-04.