Rly panel for linking fares to inflation,a one-time hike of 25%

The Pitroda committee was set up by Railway Minister Dinesh Trivedi late last year.

A high-level committee chaired by Sam Pitroda,advisor to the prime minister,has recommended that the Railways hike passenger fares one time by 25 per cent and index both passenger and freight fares to inflation to help raise Rs 60,000 crore next year.

In a presentation to the Planning Commission ahead of Railway Budget 2012-13,the Pitroda committee has said the funds could be used to part-fund a modernisation programme that will cost the Railways Rs 9,13,000 crore over five years. A one-time increase in passenger fares of 25 per cent can mobilise Rs 37,500 crore,it said.

The Pitroda committee was set up by Railway Minister Dinesh Trivedi late last year. While Trivedi has talked of the need to raise fares given the financial mess in the Railways,his party leader Mamata Banerjee has made her opposition to the same known.

Apart from an increase in fares,the Pitroda panel has urged the Railways to “actively examine indexing passenger fares and freight with inflation to mobilise another Rs 25,000 crore”,and to shift to market-oriented fares,which will improve earnings by Rs 10,000 crore.

“The net internal generation under the 12th Plan base case is estimated to be less than zero and is therefore not being considered as a source of funds,” it observed,asking the Planning Commission to provide Gross Budgetary Support of Rs 3,54,000 crore over the next five years.

The recommendations for the Railways:

* Effectively commercialise land and air space to mobilise Rs 50,000 crore.

* Cut operating costs to save Rs 15,000 crore.

* Enhance net freight revenues to earn Rs 40,000 crore.

* Levy fuel efficiency surcharge to mobilise Rs 10,000 crore.

* Explore Public Private Partnership initiatives to raise Rs 1,79,000 crore.