Almost half of the cost of your train travel is borne by the railways. The political cost of doing away with the huge subsidy on passenger fares has prevented the transporter from tinkering with tariff over the years.
The railways incurs a loss of Rs 30,000 crore every year in cross-subsidising passenger fares. "On an average, railways bears 43% cost of your travel," says a scroll running on the railways board's portal.
At a time when the transporter is under financial stress, there were expectations that the current leadership with Suresh Prabhu at the helm would revise passenger fares to bring out the transporter out of the financial mess. But, Prabhu seems to have opted for a "politically safe" path by deferring the matter and leaving the "dirty job" for the yet to be set up rail development authority.
The minister was of the view that the transporter should first focus on improving its services and try to raise resources through other means. "Whenever you raise fares, there are more questions raised than the rise. Therefore, we are trying to create a new mechanism whereby there will be a proper system that will be put in place (for revising fares)," Prabhu had said.
Besides failing to meet its annual revenue targets, the railways is faced with an additional burden of Rs 32,000 crore this year towards implementing the 7th pay commission recommendations. Soon, after assuming office in 2014, the BJP government had announced a 14% across-the-board hike in fares, but was forced to roll it bac in sub-urban sector.
Source:-The Economic Times
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