STOCK MARKET BSE NSE

Rail Fare Hike Difficult but Correct Decision, Says Jaitley

In his first reaction to the 14.2 per cent increase in passenger fares, the Defence Minister said the railways can survive only if users pay for availing of facilities.

Published: 21st June 2014 04:30 PM  |   Last Updated: 21st June 2014 07:39 PM   |  A+A-

ArunJaitley_PTI
By PTI

NEW DELHI: Defending the steep hike in rail fare and freight rates as a 'difficult but correct decision', Finance Minister Arun Jaitley said the railways can survive only if users pay for availing of facilities.

"The passenger services have been subsidised by the freight traffic. In recent years, even freight fares have come under pressure," he said in his first reaction to the 14.2 per cent increase in passenger fares and 6.5 per cent hike in freight rates.

Stating that the choice before the government was to allow the railways to bleed and eventually walk into a debt trap or raise fares, Jaitley said, "India must decide whether it wants a world-class railway or a ramshackled one.

"The railway minister has taken a difficult but a correct decision...The Indian Railways for the last few years have been running at a loss. The only way that Railways can survive is when users pay for the facilities that they avail."

Jaitley, who will present the Union budget next month, said a loss-making railway would provide below-par services and would eventually not even have the resources to meet its expenditure.

In a Facebook posting titled 'The Truth of Railway Fare Hike', the minister said the decision to increase the rates was mooted by the Railway Board on February 5, when the United Progressive Alliance was in power. The board proposed a 5 per cent increase in freight rates and a 10 per cent increase in passenger fares.

The proposal was to rationalise freight rates with effect from April 1 and passenger fares with effect from May 1, he said.

"Even as the Interim Budget of the Railways was yet to come, the date May 1, 2014, was chosen hoping that the general elections would be over by that day. The railways had proposed that this increase would give the railways an additional revenue of Rs 7,900 crore.

"Armed with this decision, the then Railway Minister Shri Mallikarjuna Kharge met the then Prime Minister Shri Manmohan Singh on February 11, 2014. The then Prime Minister approved the hike and suggested that both freight and passenger fares should be implemented with effect from May 1, 2014, itself," Jaitley said.

Also Read:

Rail Fare Hike Decision Taken under Compulsion: Kalraj Mishra 

Gowda Flays Rail Fare Hike, Questions Govt's Hurry 



Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp