A safety fund of Rs 20,000 crore for railways reeling under a series of deadly derailments, development of new lines, station redevelopment and setting up of Rail Development Authority and High Speed Rail Authority will be in focus as Finance Minister Arun Jaitley presents the first Rail Budget subsumed in the General Budget tomorrow. Going ahead with the government’s reform agenda, Jaitley will discard the 92-year-long tradition of presentation of a separate Rail Budget and instead make it part of the General Budget earmarking a few paragraphs on the public transporter’s finance, projects and the road map for the next fiscal.
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Jaitley is likely to give more focus on infrastructure development such as new lines, doubling, station redevelopment, safety upgradation. Reeling under a series of derailments, the Budget is likely to announce creation of a separate safety fund of about Rs 1 lakh crore over the next five years out of which Rs 20,000 cr will be earmarked for 2017-18, according to sources. Railways will also miss the operating ratio target of 92 per cent and is likely to settle at about 94-95 per cent.
The Budget 2017-18 is likely to announce setting up of Rail Development Authority, a regulatory authority for the public transporter. The formation of High Speed Rail Authority with the selection of its managing Director and other directors is also likely to be announced. The Budget will also give a fillip to non-fare revenue exercise and monetising assets like vacant land, estimated to be about 48,000 hectares including redevelopment of stations with private participation.
An ambitious project of increasing train speed upto 160-200 km per hour on major trunk routes will be announced which will involve fencing off the Delhi-Howrah and Delhi-Mumbai routes at an estimated cost of Rs 21,000 crore. Railway Minister Suresh Prabhu, who had written to Jaitley seeking Rs 1.19 lakh cr as a special safety fund, finally succeeded in getting a nod from the Finance Ministry for creation of a separate fund for the badly needed safety upgradation of rail infrastructure.
While Rs 15,000 crore will be from the gross budgetary support, railways will have to generate Rs 5000 crore from internal generation. It is to be seen whether the Railways will generate it by levying a safety cess or manage through the internal surplus.
The target of operating ratio is at 92 per cent Railways, which is losing both passenger and freight volumes, witnessed its traffic receipts in April-December 2016 down to Rs 1.19 lakh as against Rs 1.34 lakh cr target, a negative growth of more than 11 per cent.
Despite the introduction of flexi-fare, the passenger revenue segment has also witnessed a fall in earnings by over 9 per cent as compared to the last year. The plan outlay is likely to go up from Rs 1.21 lakh crore to about Rs 1.36 lakh cr in the next fiscal. Railways have accelerated spending by over 28 per cent on infrastructure projects in the nine months of the current fiscal as against the corresponding period in the last fiscal.
Expenditure on projects like laying new tracks, doubling and electrification of network across the country during April-December 2016 has witnessed a significant jump touching Rs 68,059 crore mark as compared to the Rs 53,118 crore in the same period last fiscal, which was an increase of 28.1 per cent, according to the Railways data. The budget will continue to focus on speedy electrification and laying of new tracks as part of capital expenditure plan.There will be no announcement of new trains. The Demand for Grants with details of allocations for states and specific projects will be taken up on February 3.