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Centre pushes Railways to reform, merge RVNL & Ircon, Rail Tel & IRCTC

These proposals are part of a report on rationalisation of government bodies prepared by Sanjeev Sanyal, Principal Economic Advisor, Ministry of Finance, after studying the structure and distribution of Railways ministry.

This will help the organisation focus on its core competence of running and maintaining the railway service. (File)

The Cabinet Secretariat has asked the Ministry of Railways to act upon a series of recommendations including a merger of Rail Vikas Nigam Ltd into IRCON, of Rail Tel into IRCTC, and a takeover of Braithwaite & Co Ltd by RITES.

These proposals are part of a report on rationalisation of government bodies prepared by Sanjeev Sanyal, Principal Economic Advisor, Ministry of Finance, after studying the structure and distribution of Railways ministry.

The proposals are wide ranging, and not restricted to PSUs: bringing 94 schools run by Railways under the Kendriya Vidyalaya Sanghatan (KVS), upgrading 125 Railway Hospitals — most of them under-invested — through an institutional mechanism and opening these to the public at large. Wherever appropriate, it suggests a PPP (public-private partnership) model for schools and hospitals run by the Railways. This will help the organisation focus on its core competence of running and maintaining the railway service.

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In a recent note sent to the Railways, the Cabinet Secretariat has asked Suneet Sharma, Chairman and CEO, Railway Board, to update it on the actions taken on the recommendations in the first week of every month.

When contacted, a senior Railway Ministry official told The Indian Express, the report had been handed over to them just a week ago. “It has now been sent to all key departments… all these require serious discussion with all members of the Railway Board,” said the official, who did not wish to be named.

On consolidation of PSUs, Sanyal’s report stated that both IRCON – a specialised infrastructure construction company, and RVNL which implements projects to create and augment rail infrastructure capacity on a fast-track basis, have similar business functions. Hence, it has said RVNL can be merged into IRCON.

Highlighting the overlaps between Rail Tel, a large telecom infra provider through optic fibre networks along railway tracks, IRCTC, a mini ratna, whose core activity is internet ticketing, and CRIS, an autonomous society to develop software for passenger ticketing, freight invoicing, passenger train operations, etc, the report recommended that CRIS be wound up after handing over its work to IRCTC, and then Rail Tel be merged into IRCTC.

The report called for setting up a new public sector enterprise to hold the three coach factories in Chennai, Kapurthala and Rae-Bareli, locomotive units in Chittaranjan, Varanasi and Patiala, and two rail wheel units in Yelahanka (Bengaluru) and Bela in Bihar. All the assets may be transferred to this CPSE, and employees deployed to the proposed enterprise in a phased manner.

Between Rail Land Development Authority (RLDA), a statutory organisation with complete powers of station development, land monetisation and contract management, and Indian Railway Stations Development Corporation Ltd, a joint venture between RLDA and IRCON, the Sanyal report said one should be identified as a sole functioning entity and given full responsibility.

The report also recommends that the Railways Board and the Ministry of Railways pull out of direct involvement in Indian Railway Welfare Organisation, a society set to provide housing to serving and retired employees. IRWO be treated as a privately run body. Both the board and the ministry must work at an arm’s length from IRWO, it said.

An officer, who did not wish to be identified, said many of these PSUs and bodies existed simply because they served as a parking space for officers who wished to be retained in a certain city or region. Another officer explained that in many of these societies, companies might have had an objective at some point of time, but their creation was also a result of departmentalism within the railways.

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