HOUSE PANEL ASKS RAILWAYS TO JUSTIFY GOODS, PASSENGER TRAIN FARES PRUDENTLY

NEW DELHI: A parliamentary panel has raised concerns over the losses incurred by the Indian Railways passenger services especially due to its social service obligation, and suggested that the national transporter rationalise both freight and passenger fares “prudently”.

The Standing Committee on Railways on ‘Demands for Grants (2020-21) of the Ministry of Railways’, which submitted its report in the current session of Parliament, has stated that there is a need to revisit the components that constitute social service obligations of the national transporter.

“The committee is concerned to note the losses incurred by the railways in passenger services purportedly due to the social service obligations which, inter alia, include pricing tickets at fares lower than costs, passenger concessions.”

“The predicament of the railways is that the profits earned from freight business are utilised to compensate for the lossess incurred on passenger and other coaching services, thereby adversely affecting both freight and passenger business. It, therefore, becomes imperative that both freight and passenger fares are rationalised prudently,” it said.

The railways, in its response, said the National Institute of Public Finance and Policy has been engaged to carry out a study on “Developing a mechanism for computing the value of Social Service Obligations being borne by Indian Railways in 2017”.