Intro: Indian Railways are the life lines of our economy and we must ensure the modernisation and expansion of it as we have plenty of resources.
Indian Railways are being operated under the Indian Railways Act of 1890, enacted by the erstwhile British rulers of the Indian subcontinent. This Act was amended in 1989 and 2005 and 2008 for certain provisions. For more than 120 years since the promulgation of the original Act in 1890, including 67 years of Independence, the Railways have been run as a central government entity. But it is too well known that during the last four or five decades, the Railways have been used by the political leaders as tools for popular appeasement for consolidating vote banks more than a means of transportation service delivery. This had to change sooner than later.
Today, we painfully realise the cold fact that the Railways system has not kept pace with the times in terms of speed, technology, efficiency or safety. It is only in the last one year that there has been a visible reduction in Railway accidents. The years from 2006 to 2013 have been terrible for train safety. We are privy to very many episodes of Railway accidents during the Lalu-Nitish-Mamata period resulting in huge loss of life and property. This too had to change and is now slated to change for the better.
Modernisation of Railways including tracks and signalling systems is the crying need of the hour. The Modi Government has done well to prepare a practical blueprint of improvement of Indian Railways system which includes a plan for establishing manufacturing facilities in India as a part of the broader Make in India initiative. But to make this happen, certain important steps will need to be taken.
The Indian Railways network spans more than 64,600 kms making it the third largest rail network globally. It is also the largest passenger carrier and the fourth largest rail freight carrier in the world. The Railway Sector runs 12,617 trains, carrying over 23 million passengers daily and connecting more than 7,172 stations. Indian Railways runs more than 7,420 freight trains. It employs 1.3 million employees. Such a large utility system needs to be operated, maintained and overall managed on truly professional lines to ensure commercially viability, efficiency and safety. Public Private Partnership (PPP) model is proposed for establishing manufacturing facilities in the Railways sector. Considering all this, we shall need an independent regulatory body with quasi judicial powers which will fix Railway fares on a rational and fair basis.
The need for a regulator is underlined by the proposed FDI in certain areas. So far, the Railway tariff fixation has been done by Railway Ministry which will not be proper in the new circumstances. This, in turn, will call for legislative changes in the form of amendments to the existing Indian Railways Act or a fresh and net Act under which the private or PPP entities shall be regulated.
The proposal to invite 100 per cent FDI in some areas is being seen fraught with problems. It may result in huge repatriation of foreign exchange which will not be offset because there may be little export market for Railway manufacturing facilities in India. It is observed that keeping FDI limited to 49 per cent may be a more prudent policy as it will afford an additional advantage of ownership resting with the Indian partners. We need to do more technology collaborations and focus on FDI more in high technology areas like bullet trains. Our Central Sector PSUs—RITES and RDSO should forge technology collaborations with foreign countries to absorb high technologies.
PPP is the appropriate model for setting up manufacturing entities for Railways systems in India. But the terms for ownership and transfer of assets will have to be prudently worked out, keeping national interests uppermost in the mind. Under the proposed arrangements, Railways in India will have to run on purely commercial lines and the operations of the Railways Department will have to be declutched from politics.
Railways are the life lines of our economy and we must use our indigenous resources as far as possible for both Railways manufacturing and Railways network building. We can take foreign help in technology area like for establishing bullet trains. But apart from technology, all other resources for Railways expansion, modernisation and manufacturing are available with us aplenty and we must use them as required.
There is no dearth of money in India or owned by Indians. Humungous amount of money exists as unaccounted or illegal money—in India or abroad. This money has to be brought back to national exchequer and used for national development, including the development of Railways systems. (The writer is a senior columnist)