The going has just got tougher for the Union Railway Minister, Mr Dinesh Trivedi.
With just two weeks to go for the Railway Budget, the Finance Ministry is learnt to have approved a gross budgetary support (GBS) of Rs 25,000 crore for Indian Railways, half of what Railways had sought, sources-in-the-know of the developments said.
Last year, the GBS was Rs 20,000 crore. Last week, a modernisation committee headed by Mr Sam Pitroda had recommended a Rs 50,000-crore budgetary support for the Indian Railways.
With the short-term view looking bleak, Mr Trivedi is more likely to portray a long term vision in this Railway Budget. Probably anticipating such a situation, the modernisation committee had said: “We strongly recommend that Budget should focus on a modernisation plan with a vision for a generational change to take Indian Railways to new heights with commitment to safety and growth for all.”
The Cabinet has also approved a proposal for a five per cent dividend rate to the Railways.
This is according to the recommendation of the Railway Convention Committee (RCC) in mid-2011. This is lower than the dividend rate of six per cent fixed for 2010-11 and 2009-10. The Railway Ministry had requested for a 3 per cent dividend rate, after its earlier request for a five-year dividend waiver was turned down.
Usually, the Railway Ministry requests for a lower dividend rate and the Finance Ministry requests for a higher dividend rate. RCC is a Parliamentary Committee. The decision is firmed up after a Cabinet approval.