To speed up execution of works in Indian Railways, Railway minister Piyush Goyal has sought an increase by four times in the financial powers to sanction projects without having to seek approval of Parliament. Currently Railway ministry needs to seek approval of Parliament for any new project/works beyond Rs 2.5 crore. In a letter to Finance Minister Arun Jaitley last month, Goyal has explained that the existing threshold is a decade old and it should be enhanced to Rs 10 crore. The limit was last revised in 2006. The reason behind seeking an enhancement is that cost of projects, like construction of new lines and the like, has increased manifold in the past 10 years. As a result, a large number of projects easily cross that threshold and the Railway ministry needs to go to Parliament for approvals. Any expenditure on what is construed as “new service” or “new instrument of service” beyond the threshold requires approval of Parliament since it involves drawing from the Consolidated Fund of India. The exercise usually happens during the Budget session and can happen during any session of Parliament. If the limit is enhanced to Rs 10 crore, Railways would be able to provide financial approvals to those projects internally minus the multiple, time-consuming processes involved in approaching Parliament. This, the ministry argues, will cut down the overall project implementation time drastically through faster decision-making. In the bouquet of 1,624 new works approved for Railways in this year’s Budget, 1,454 or around 90 per cent, are below the threshold of Rs 10 crore, a point Goyal has mentioned in his letter to Jaitley. Enhancing the threshold would also mean several safety-related works of urgent nature could be approved without waiting for Parliament nod. “Proposed increase in the threshold limit would enable Indian Railways to further empower field units to sanction works/projects of immediate safety concerns without waiting for the cycle of Annual Budget,” Goyal has said in the letter. The financial threshold beyond which ministries need to seek Parliament approval is decided by the Public Accounts Committee (PAC), headed by an MP from the principal Opposition party. The Finance minister or ministry can set the ball in motion for the PAC to reconsider the threshold. The last time it was revised was in 2006 when the limit was set at Rs 2.5 crore from mere Rs 50 lakh, which had remained for decades. The cost of doubling of lines is approximately around Rs 5-6 crore per km, whereas that for constructing new lines would be more or less the same plus the cost of the land. While Railways gets these approved by Parliament depending on the cost of individual works, there are also works of emergent nature. For these, the ministry often resorts to sanctioning the works to seek Parliament approval with justification at a later date. As on April 1, 2017, Railways is sitting on projects worth around Rs 4 lakh crore in new lines, doubling and gauge conversion. The PMO, in its regular review of progress of works in Railways emphasizes on faster execution citing the fact that there is assured funding. To aid speed of execution, Goyal has initiated delegation of financial and allied decision-making powers to the filed units down to the level of Divisional Railway Managers so that no project is held up for want of timely approvals at appropriate levels.
