Railways to get regulator to fix tariff
New Delhi, April 5: The Union cabinet on Wednesday approved the formation of an independent rail regulatory authority to determine tariffs ensuring fair play and level playing field for private players keen on investment in the railways.
Considered to be the biggest and first-of-itskind reform in the rail sector, setting up of Rail Development Authority (RDA) is meant to improve the services offered to passengers, provide comfort to investors and enhance transparency and accountability.
The RDA will be formed through an executive order of the government, according to the cabinet decision. It will make suggestions regarding policies for private investment to ensure reasonable safeguards to PPP investors and to resolve disputes over future concession agreements.
The need of having a rail regulator has been emphasised by various committees for past many years since 2001. The RDA will act within the parameters of the Railway Act, 1989 and its major functions will be tariff determination and recommending principles for classification of commodities, framing principles for social service obligation and guidelines for track access charge.
It will also be responsible for setting efficiency and performance standards besides global practices and benchmarking.
The authority will have a chairman and 3 members and can engage experts from relevant areas. The Chairman and the members of RDA will have a term of five years. An initial corpus of `50 crores will be provided for setting up the organisation.
RDA will help the government to take appropriate decisions on pricing of services commensurate with costs, suggest measures for enhancement of non-fare revenue, protection of consumer interests, promote competition, encourage market development and create positive environment for investment. — PTI
OTHER COMMITTEES that suggested the formation of an independent regulatory authority in the past include Expert Group under the chairmanship of Rakesh Mohan in 2001, the National Transport Development Policy Committee (NTDPC) in 2014 and Bibek Debroy’s Committee in 2015