Corporatise the Railways

Subir Roy

One of the prestigious Rajdhani Express trains derailed as it entered the New Delhi railway station, the very day the Prime Minister and his Japanese counterpart laid the foundation stone for India's first bullet train project. It has been a numbing month of derailments that have followed close on the heels of the Utkal Express accident in which 23 people died. 

The Railways is in a state of crisis, with reports of frequent derailments and resultant deaths, leading to Suresh Prabhu, once rated highly as a minister, being shifted out of the Railway Ministry. His place has now been taken by another highly rated minister, Piyush Goyal.

The issues that need addressing urgently are: what has gone so grievously wrong with the Railways? What is the priority agenda that needs to be adopted to get the Railways back on track? Has Goyal got his priorities right? Has he made the right noises since taking over?

To take the last question first, Goyal has said the following: Unmanned level crossings (a key cause of accidents) can be eliminated in a year and not three, as planned; make track renewal a priority, diverting rails earmarked for new tracks; technology can be used to reduce manual maintenance of tracks, their condition being another key cause of accidents through outdated rails getting fractured; and catering staff should not ask for tips. 

All these are sensible points and show Goyal has the right basic approach. But if the outgoing minister Suresh Prabhu was equally aware of these imperatives, as he certainly was, then why was he so ineffective in halting the decline, not to speak of turning things around? An answer to this can help us outline Goyal's immediate agenda.  

The first point is that motivation and staff morale in the Railways seem to be at an all-time low. The Utkal Express accident happened because established procedures were brazenly flouted. It is human failure, a major cause of accidents, that leads to well-established procedures and drills being flouted. 

Why has staff morale plummeted?

1 Recently there has been increasing pressure to perform. In response, people in operations have sought to cut corners. 

2 The merger of the Rail Budget with the General Budget has damaged the esprit de corps among officials who no longer see themselves as a bit different, having become part of a huge undistinguishable crowd of other government officials. 

3  The third factor has come from a former senior Railway official who in an emotional outburst blurted out, "They seem to be interested only in making money."

So, the first solution is for the staff down the line to again feel that the Indian Railways is a unique organisation, the only one of its size and kind in the world, and it is a matter of pride to be a part of it. For this to happen the Railways has to have a charismatic leader, ideally a Railwayman himself, and not faceless Railway Board chairmen and de facto leaders in ministers who come and go. This charismatic leader has to unite everybody into a team that delivers according to laid down milestones. He must bring about reforms in the set-up.

Reforms needed

1 The best way out is for the Railways to be corporatised. (This has nothing to do with privatisation as the government can continue to hold a majority or even 100 per cent of the shares of the corporate entity). So the conditions need to be created for a Steve Jobs (Apple) or a Larry Page (Alphabet or Google) to come up and lead. 

2 The second reform that goes hand in hand with corporatisation is doing up the accounts according to company law so that financial performance can be used as a universal tool and yardstick through which the railways can be benchmarked. A key failure of the Railways - taking too long to complete a task on which all are agreed - is highlighted by this inability to introduce double entry bookkeeping even after working on it for years.  

3 This brings us to the third urgently needed reform - changing the role of the Railway Board chairman. At present, he merely presides over meetings without having the powers to enforce his decisions. If two board members disagree on an issue, the decision on the matter is postponed. The writ of the chairman must run like that of the CEO in a corporate structure. 

4 Bring an end to what is the bane of the Railways — inter-departmental rivalry. As a result, different parts, manned by respective officer cadres, act like silos, having foremost in their minds their own interests rather than the overall ones of the Railways. One of the reforms proposed by Prabhu was to merge the different cadres into two cadres - a technical and non-technical one - but, obviously the opposition to that has been too strong.

5 The fifth reform, which is a part of corporatisation, is to reorganise the Railway Board so that its members do not just represent different operations but customer or business segments too. For example, now there is a member, rolling stock, and a member, traction. Whereas there should also be a member, freight, and a member, passengers. 

All these strands need to come together under an overall vision. Many years ago, a group of us from the media and communications, all Indian Railways enthusiasts, tried to come up with a slogan that would capture the ethos of the Railways. What we cobbled together was: "Safety first, profits must, always just". 

The first two phrases don't need explaining. But not satisfied with just those, we wanted to add something that would represent the idea that the Railways keeps the country together, and there is something in it for all Indians, big and small, and hence its ethos must be informed by a sense of equity. So it is always fair, inclusive, "just".