First, this is great news for the Railway Minister, as the entire responsibility for financial aspects of the Railways shifts to the Finance Minister and the Finance Ministry.
The Railways’ present situation lacks resources ...it is almost like having to prepare food for 10 crore people when you have raw materials only for 100.
If this move helps the Railways, I shall be happy.
A separate Railway Budget was created in 1924 by a Separate Convention passed by the then Legislative Assembly, which is like Parliament. Logically, therefore it should have come back to Parliament for a wider discussion on repealing the same.
Parliament was not taken into confidence, which is not in keeping with the spirit of democracy. I know business papers will give it (the decision) a big thumbs up, as they hardly use trains...only time will tell whether it (merger) was good or not.
I am more concerned whether investments will come to the Railways.
The Railways, at the moment, is in a financial mess. And I do not blame Prabhu for that... It is already in a debt trap and will have to soon borrow money to pay salaries. Even if the Railways had to present a budget this year, it would have been difficult, as there are no funds.
It reminds me of the time when I was Railway Minister (mid 2011-to mid-2012). The then Financial Commissioner came and told me: ‘Sir, there can be no budget this year.’ I asked her what she meant? She said: ‘We don’t have money to prepare a budget, unless you generate some internal resources or the government gives fund to the Railways.
The situation of the Railways is similar now, rather, much worse. As per the August numbers, its operating ratio (a measure of profitability) could be close to 150-200, if you take the Seventh Pay Commission into account.
Indian Railways has the potential to add 2.5 per cent to the GDP.
The definition of Railways as a commercial entity, which has been there since British times, is itself in question!
When you invest in roads in villages, electricity transmission, AIIMS, IITs, do you ask for rate of return? I had asked the then Prime Minister ( Manmohan Singh) when the Approach Paper for the 12th Plan was being prepared: ‘Do you want the Railways to be perceived as only a poor man’s transportation or a catalyst in GDP growth?’
Now, my fear is that a person in a remote Naxal-affected area will not get a rail track, as the Finance Minister will say, “Look here, I have to keep my fiscal deficit in control.”
The move is also an indication enough that the Railways may perhaps be going on the way to privatisation.
It is easy to demolish a system but it takes years to create one. Finally, there are some questions: What happens to the debt that the Railways has taken? What happens to the fate of projects that are financially unviable but socially desirable, say, strategic lines to take rail links to the borders? If an MP wants some projects, where will he go?
Also, without a separate Railway Budget, where will the 1.4 million workers (employees) go ? They will have to meet the Finance Minister.
It also appears that the Railway Convention Committee will have to be demolished.
With this decision, why do you need a separate Railway Ministry? Why is a Railway Board, Financial Commissioner required?
With this perhaps it will make more sense to have only one ministry of transportation and mobility, under which you could have Ministry of Railways, Surface Transport, Shipping and Civil Aviation.
The fact is, subsequent governments have not realised the strength of the Indian Railways.
(As told to Mamuni Das)