The new Railways Minister Mamata Banerjees declaration that she will soon get a white paper drafted on Indian Railways performance over the last five years raised ripples. An impression was created that the stories about IRs performance in Lalu Prasads tenure were not that genuine.
But manipulating the figures for five whole years would require the breakdown of all checks and balances,the failure of statutory audits and systems. Yes,changes such as the capital component in Indian Railways Finance Corporation transactions being shifted from the working expenses would,as they actually did,show an increase in the profit and cash surplus. But reading sinister motives into this is excessive. There is no denying that IRs traffic throughout rose substantially,and with it revenues. Theres little scope for jugglery: Prasad says cash surplus rose from Rs 9,000 crore in 2005 to Rs 14,000 crore in 2006,Rs 20,000 crore in 2007 and,in 2007-08 to Rs 25,000 crore.
Lalu saw quick gains yielding from this simple step. Those,in turn,gave rise to the second ancillary measure: faster,longer and heavier trains. Faster trains required better turn-round of wagons and locomotives by reducing delays in transit and at terminals. IRs freight volumes thus grew 9 per cent a year in 2004-08,and productivity grew at twice the 90s rate. An important spin-off was reduction in unit costs,allowing IR to tinker with differential pricing of freight services and other revenue-raising initiatives.
The Lalu years saw a few other revenue-enhancing tactics. He often claimed not to believe in freight and fare hikes; but there were a large number of surreptitious increases effected in freight rates,through reclassification and myriad surcharges and levies on most commodities except some like petroleum and steel,which had already been overpriced. Without any appreciable change in the product mix and pattern,IRs earnings from freight increased by 98 per cent during the period,while the total freight output rose only by 42 per cent; clearly,substantial increases in freight rates took place.
Likewise,passenger kilometres clocked by IR increased by 59 per cent while earnings went up 68 per cent. IR obviously imposed additional charges on the sly while ostensibly even making a symbolic reduction in passenger fares. How? Apart from an irrationally large number of seats/ berths being put in the Tatkal quota,leading to artificial shortage of accommodation for general categories and imposing additional cost,more than 370 trains were arbitrarily redefined as super-fast although their speed had not increased.
What Lalu did was required. But he could have,as well,done it in an open and transparent manner. Passengers will take in their stride some increases in fares; so explain to them the logic and need. Lalu Prasads revenue enhancement was in good faith,in the interest of the organisation. But proclaiming that increases in income accrued without raising fare or freight rates would be a travesty.
Lalu eventually rose above his circumstances. Take his first rail budget,for 2004: he unveiled his penchant for mattha and lassi,kulhars and khadi,policy for bookstalls and coolies. In contrast,his 2008 budget showed he realised the need for a long-term grid for IR. With a measure of confidence and a clear perspective,he charted a path towards IRs modernisation,delineating new genre rolling stock,track structure,signalling,developing high density routes,
IT-enabled facilities and strategic business units involving major sector users.
While he failed to ensure timely and effective implementation and ignored several tough issues especially about rationalising fares and workforce,there was much hype generated around his persona now possibly detrimental to his interests. People resent the pernicious practice of ministers squandering crores of public money on pages and pages of media advertisements. Actions speak louder than words. Yet,in the end,he claimed he had zero tolerance for political interference with IRs daily operations. In todays governance in the country,that itself is no small gesture.
The writer was the first MD of the Container Corporation of India express@expressindia.com
