Railways get on to fast track

Centre to set up independent regulator to transform railways

The Centre is set to constitute a Rail Development Authority (RDA) that will not only recommend passenger and freight fares but also lay down a roadmap for the transformation of Indian Railways. The move is seen as the beginning of the clipping of the wings of the Railway Board.

The government has changed the name of the Rail Tariff Authority to Rail Development Authority to give it a much larger mandate, on the lines of independent regulators in the insurance and telecom sectors.

The RDA, sources said, is being set up on the lines of the Commissioner for Railway Safety (CRS), which is under the ministry of civil aviation. “The RDA is proposed to be set up under either ministry of finance or corporate affairs to make it independent of the railways. The body will not only function independent of political interference in recommending passenger and freight fares, but also suggest changes in policies and rules to attract private investment,” sources said.

The Centre is set to constitute a Rail Development Authority (RDA) that will not only recommend passenger and freight fares but also lay down a road map for the transformation of Indian Railways. The move is seen as the beginning of the clipping of the wings of the Railway Board. The setting up of the RDA is being seen as a major reform in line with the Bibek Debroy Committee's recommendations of January 4, 2015. The RDA was constituted by Prime Minister. “The Prime Minister is keen to change the character of the railways, which is seen as a top-heavy bureaucratic organisation. Despite a number of reports in the last one decade, the railways thwarted all attempts to institutionalise changes. The setting up of the RDA through an executive order without going through the rigour of getting parliamentary approval is an indication of urgency at the top level of government to go for strong reforms,” sources added.

The urgency to set up the RDA comes after Indian Railways admitted that it is bearing a loss of `34,000 crore in passenger traffic, which is being cross-subsidised by higher freight fares, which, in turn, is forcing goods transporters to shift to the road sector.