Concern as rising operational ratio throws Indian Railways off track

Top Railway officials expressed concerns over rising operating ratio and railways failing to operationalise non-fare revenue policies.

Published: 25th August 2018 04:07 AM  |   Last Updated: 25th August 2018 04:07 AM   |  A+A-

Indian Railways

Image used for representational purpose. (Photo | File/PTI)

Express News Service

NEW DELHI: As railways reported worst operating ratio, direct indicator of working of government-run transporter, in recent times, its efforts to balance losses from non-fare revenue resources has failed to take off with major policy initiative still stuck in procedural changes.

Indian Railways' cost of operations by end of July touched Rs 111, which means to earn Rs 100, railways had to spend Rs 111. Lower operating ratio is considered good for its financial health.

Top Railway officials expressed concerns over rising operating ratio and railways failing to operationalise non-fare revenue (NFR) policies.

“Operating ratio is a cause of concern but railway needs to balance it with NFR earning and improving efficiency. The NFR has been slow starter due to poor response from vendors but we are working to make it operational by decentralizing it and allowing zonal railways to take responsibility,” said a ministry source.

The tender for Railway Display Network (RDN) was brought out but only two vendors turned up. The out of home (OOH) advertisement on stations, over and under bridges, level-crossings, railway colonies, workshops, production units and railway land along tracks met a similar fate.  The NFR policy was launched by former railway minister Suresh Prabhu in January 2017, aiming to get an annual contribution of Rs 10,000 crore from the segment. The idea was that NFR can substitute for over Rs 35,000 crore subsidy provided in passenger segment.

Other policy initiatives under NFR included vinyl wrapping and branding of trains, content on demand and ATM policy. Other areas where railway was looking to increase revenue was monetization of vacant land and station redevelopment. Both have remained a slow starter and so far work has started for two railway stations - Habibganj and Gandhinagar.

Worried over slow progress of NFR, Chairman Railway Board Ashwani Lohani wrote to zonal railways in July asking them to expedite efforts to generate NFR.

NFR earnings (till April)

  • 2016-2017: Rs 10,338 crore

  • 2017-2018: Rs 8,600 crore

  • 2018-2019: Rs 32.65 crore

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