Transforming the Railways
With the Bibek Debroy committee submitting its final report, the Railways is set for big changes. There is reason to believe that this will not be another committee and another report since the Modi government appears determined to transform the Railways and minister Suresh Prabhu was handpicked for the job. Well-off people may get a choice to travel by super-fast private trains run by the Ambanis and the Tatas. Allaying fears in some quarters, the committee has clarified that it has endorsed private entry as in the case of airports, ports, telecom and roads, but not recommended privatisation of the Railways. The Railways provides affordable travel to ordinary people. Without sacrificing this service, the Railways has to be made commercially viable. This is a challenge since high-end passenger and freight business would possibly go to more-efficient private players.
To balance public service and private profit, and curb the malaise of political interference in the functioning of the Railways it is proposed that a regulatory authority be set up independent of the Railway Ministry having a statutory backing, with a separate budget and with quasi-judicial powers. Incidentally, the drama of presenting a separate budget for the Railways may come to an end as many experts see it as a colonial practice. The committee also favours the separation of peripheral activities like running schools and hospitals, real estate, catering and maintaining the Railway Protection Force from the core business of transportation. Three key functions of the Railways — policymaking, regulatory work and operation — may get separated. It is apparent the Railway Board is not going to be happy about the committee’s recommendations, which also include decentralisation of powers. It wants to develop divisions and zones as independent business centres.
Big ideas all, and some make sense too, but where is the money? An investment advisory committee of experts has been proposed to raise resources. The railway assets, including surplus land, may be monetised or commercially exploited. The burden on passengers, however, should be minimum and freight rates should not become so high that industry turns to road transportation. It is an ambitious vision which will test Modi's leadership.
