Emboldened by the lukewarm criticism of the recent hike in railway fares, the first in a decade, the railway ministry is now considering yet another upward revision. While this may not happen in next month’s Railway Budget, it is learnt the financially-strapped Indian Railways could take a fresh look at fares in the coming months, while an increase in freight rates is also on the anvil.
It has now emerged that last week’s hike was done with the aim of checking the passenger rush for the Maha Kumbh Mela near Allahabad, held once every 12 years, for which the Railways expect more than 50 million people to travel by train. But encouraged by the absence of any major public or political outcry over the hike, the railways hope that with gradual hikes in both passenger fares and freight rates, it will be able to reduce the cross-subsidisation of passenger traffic by freight revenue, that is expected to be a whopping `25,000 crores in 2012-13.
“While minister Pawan Kumar Bansal had ruled out a fare hike in next month’s Rail Budget, the positive response to last week’s upward revision has opened up the window for some more incremental hikes to boost the railways’ earnings,” said a senior official.
Last week’s fare hike was on an average around 25 per cent across all classes, with the minimum seen in AC-3 classes and the maximum in sleeper classes. “There is ample scope for incremental hikes in rail fares, which can be done within a few months after the Rail Budget,” the official added.
However, “there is not much elbow room for hiking freight rates, though it will have to be done,” the official added.