Bengaluru: In a move lauded by some as progressive and empowering, the Karnataka State Congress government’s Shakti Yojana, which offers free bus travel to women, has inadvertently cast a shadow over the financial viability of the state’s four road transport corporations. Launched in June 2023, this ambitious scheme has saddled the already ailing transport entities with massive financial burdens that could lead to their eventual collapse if corrective measures are not swiftly implemented.
Despite the apparent altruism of the Shakti Yojana, the financial aftermath tells a different story. The current state of the four road transport corporations—Karnataka State Road Transport Corporation (KSRTC), Bangalore Metropolitan Transport Corporation (BMTC), Northwestern Road Transport Corporation, and Kalyana Karnataka Transport Corporation—paints a picture of operational distress and mounting debt, attributable, in no small part, to the implementation of the Shakti Yojana.
The Financial Collapse Amidst the Shakti Yojana
Before delving into the detailed financial statistics, it’s essential to observe the broader context. The road transport corporations were already grappling with financial difficulties before the Shakti Yojana’s rollout. However, with the implementation of this initiative, which has reportedly allowed around 363 crore women to travel for free since its launch, the strains have become evident.
The cost of this program has soared to an astonishing Rs. 8,800 crores, much of which is being shouldered by the corporations themselves. To mitigate the escalating costs, and after experiencing extreme revenue deficits, the state government has been forced to raise ticket prices by 15%. This is not just a temporary measure; it signifies a desperate attempt to plug the financial drain caused by the free travel initiative.
Moreover, the government’s decision to provide a loan of Rs. 2,000 crores to these corporations exemplifies a short-sighted strategy that will likely lead to further fiscal complications down the road. By relying on loans instead of devising robust revenue-generating strategies, the government increases the risk of these corporations falling into a deeper debt trap—a cycle that could ultimately undermine the very objectives of the Shakti Yojana.
Profit and Loss: A Discrepancy of Expectations
The Shakti Yojana was brought forth with the promise of improved accessibility for women and lower travel costs. Yet, scrutinizing the profit and loss sheets presents a grim reality. The four road transport corporations collectively reported significant losses over the last several years, and this trend has only intensified since the Shakti Yojana’s implementation.
For instance, KSRTC reported a staggering loss of Rs. 423 crores in 2021-22, escalating to Rs. 597 crores in 2022-23, and a projected loss of Rs. 295 crores for 2023-24. Similarly, BMTC’s losses soared from Rs. 178 crores in 2021-22 to nearly Rs. 997 crores in 2022-23, with an ongoing loss of Rs. 575 crores expected for the current fiscal year. The other transport corporations mirrored this perilous trend, indicating a systemic issue that transcends mere operational oversights.
This continued decline highlights a critical flaw in the budget forecasting and financial planning mechanisms of the Karnataka government. If the Shakti Yojana is to be sustainable, a fundamental re-evaluation of its financial model becomes paramount. Unfortunately, it appears that the government’s approach has merely been to throw more money at the problem rather than addressing the root causes of the corporations’ financial troubles.
The Burden of Debt and Operational Costs
With the current debt load projected to be around Rs. 5,614 crores, the transport corporations are staggering under unmanageable liabilities, including salaries, provident fund dues, and rising fuel costs. The financial situation is worsened by daily operational costs that exceed Rs 31.57 crores, Rs 13.21 crores on diesel and Rs 18.36 crores on staff salaries alone. These mounting operational costs do not align with the funding the government allocates, which, despite reaching Rs 6,543 crores since the Shakti Yojana’s introduction, remains insufficient to cover the ongoing operating deficits. The state government should pay Rs 2257 crores to corporations under Shakthi yojana, which pending since last six months.
Critically, the allocation of funds has not been uniform across the corporations. Of the total funds released, KSRTC received Rs. 2,481 crores, while BMTC, Northwestern Transport, and Kalyana Karnataka Transport Corporation received Rs. 1,126 crores, Rs. 1,613 crores, and Rs. 1,321 crores respectively. This discrepancy creates further challenges in resource allocation and necessitates extensive strategic planning to ensure equitable funding across all entities.Congres
Comments