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The Big Picture – Railways: What’s the right track?

The Big Picture – Railways: What’s the right track?



Railways has been crying out for help for decades. Despite the huge allocation of funds that it gets each year, the lefeline of India continues to suffer. However, now a governemt panel, setup to study the restructuring of railways, has set a five year roadmap to bring in new reforms. An official committee, headed by NITI Aayog member Bibek Debroy, has recommended a whole set of reforms, including entry of private players into the Railways, and separation of offline activities from the core business. The committee’s report on restructuring has come at a time when the Railway Minister has made a pitch for giving more powers to the railway protection force for better policing of rail premises, seeking consent of all states to amend the RPF Act, 1957, so its personnel could lodge FIRs for crimes committed at stations and on trains. The power is currently vested with the Government Railway Police (GRP), controlled by states.

Important recommendations made by the committee:

  • Separation of activities like running of hospitals, schools, catering, real estate development, manufacturing of locomotives, coaches and wagons from the core business of running trains.
  • State governments should be asked to entirely fund the Government Railway Police (GRP) and the general managers should have the freedom to choose between private security guards and RPF for security on trains.
  • Establishment of an independent regulator — Railway Regulatory Authority of India. The Regulator will work under the policy framed by the Ministry, while the present Railway Board will become a board of Indian Railways — the government-run operator — alone. The Regulator can recommend fare revisions but these will not be binding on the Railway Ministry leaving scope, presumably, for the political dispensation of the day to take a call.
  • Scrap the Rail Budget and make room for more players in an “open access” regime.
  • Create a Railway Ministry with at least three Secretary-level officers to lay down policy for the rail sector.

On medical service undertaken by the Railway, the committee has recommended a multi-pronged approach. It has said for functions such as periodic medical examination, pre-employment examination, medical boards, safe water and food supply at stations, the GMs and DRMs as also the employees could be given the choice to opt for services either through Indian Railway Medical Service or through private empanelled practitioners.

Reacting to Debroy panel’s report, the National Federation of Indian Railways has said it has totally failed in understanding the complexities of the Indian Railway’s working system. The recommendation to separate production units, hospitals, medical services, schools and RPF from the main activity of running trains is totally wrong as these supporting activities strengthen the Indian Railway in providing services to the customers. The Railways is categorised into 16 geographical zones, employing about 1.3 million people with a cadre-based department like mechanical, engineering and electrical.

Some experts say that it is not desirable to experiment with FDI and private players in infrastructure without building massive railway infrastructure first. They say that political compulsions and commitments are responsible for slowing down of the railway network and train speeds and not the railway workforce. Currently, Railways works on a top-down hierarchical model with a six-member Railway Board which implements and monitors policies and takes all key decisions. Trade unions fear any effort at bringing in private players into railway operations would jeopardise the workers’ jobs and negatively impact railways’ financial health.

The Economic Survey had noted that a Re1 increase in railway output increases the output in the economy by Rs3.3. This huge multiplier effect demonstrates the impact that Indian Railways has on both the industry and private citizens. Several committees have proposed an array of railway reforms in the past three decades. But till date, no government has shown the institutional will to introduce structural changes in a system that was allowed to grow unwieldy and too big to fail.