Faced with a mounting deficit of over Rs 20,000 crore in the passenger segment, the railways is keen on hiking passenger fares between 5-10 paise per km in the coming months to generate about Rs 4,000-crore revenue.

The hike could come close on the heels of railways finalising the broader contours of the proposed Rail Tariff Authority (RTA), which would be placed before Cabinet in January.

“The passenger fares should be hiked by 5 paise to 10 paise per km in the Rail Budget (2013-14). The financial condition of railways is not good. We need funds, otherwise railways will not survive,” Minister of State for Railways K.J. Surya Prakash Reddy told PTI.

The other Minister of State Adhir Ranjan Chowdhury also advocated an urgent hike in fare. “There is an urgent need for passenger hike as the railways’ financial condition is bad.”

However, a senior railway official said: “A decision is yet to be taken whether to increase the passenger fares before the Rail Budget or announce it in the Budget.”

Asked about the quantum of possible hike, the official said: “It is likely to be between 10 per cent and 15 per cent,” something which former Railway Minister Dinesh Trivedi had proposed in the last Rail Budget.

Rail Tariff Authority

Reviewing the performance of railways, the Prime Minister’s Office has asked the Railway Board Chairman to finalise and submit its recommendations on the constitution of RTA by December 31.

RTA is expected to suggest the quantum of hike in passenger fares and freight tariff.

“We are working on it (RTA),” said Railway Minister Pawan Kumar Bansal when asked about the progress on RTA.

Related Topics