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Railway Budget 2016: A Way Forward

Railway Budget

MBA aspirants must be updated with General Awareness on current affairs. General Awareness topics with analytically drawn conclusions will benefit you in XATIIFTNMATSNAP ,CMATMAT, and later in Post exams screening Tests like  WATGD & PI , Essay writing

Read General Awareness Topic:  Railway Budget 2016 : A Way Forward

Railway Budget 2016

Indian Railways has played a great in the integration as well as the economic development of the country. In his Rail Budget speech, the Union Minister Suresh Prabhu himself had said that investment of INR 1 in railways translates into the income of INR 5 in the GDP. In his 2015 Rail Minister called for investment of INR8.5 lakhs crore in the next five years to improve the infrastructure, passenger amenities, dedicated freight corridor, upgrading the rolling stock, station development. For the fiscal 2016-17, the targeted investment would be INR1.21 lakhs crore, a jump of 21% from the current fiscal.

For the second consecutive year, budget didn’t announced any new trains and focussed on  improving the quality of travel, increasing its outreach in northeast, increase in average speed, safety, electrification etc. Some of the major announcements made in the budget and its likely impact are as under –

Railway Budget 2016

No Fare Hike

Despite the huge investment needs, no fare hike was proposed in the budget.Railways would seek to develop alternative means to generate revenue. In the current year, railways is incurring the loss of INR30,000 crores due to the subsidised passenger travel which is expected to increase to INR40,000 crores. In order to plug these losses railways would cut the costs and generate other sources of revenue. Hike in fare and freight is indeed not a permanent solution to generate the investible funds as railways is still the popular more of surface transport for a common man and rise in freight charge would ultimately be manifested in the inflation rise. However, the budget failed to cite any alternate sources of revenue.

Nevertheless, there are several other means to generate revenue. For example, railway is planning to introduce free Wi-Fi at 400 stations. Instead, it can be a paid service. Moreover, paid Wi-Fi can also be introduced in trains. Railways can also benefit from the fast growing advertisement industry by taking a cue from the Delhi Metro.

Railway Budget 2016

New Category Of Trains

Humsafar, Tejas, Uday and Antyodaya are the new categories of trains introduced in the budget. Tejas will run at 130 kph while Humsafar would be the fully AC train and both would ensure cost recovery through tariff and non-tariff measures. Utkrisht Double-decker Air-conditioned Yatri (UDAY) will be introduced on the most congested routes. Uday will increase the passenger carrying capacity by 40%. As it is not possible to run new trains on the congested routes like Delhi-Howrah, Uday is a good innovation to accommodate more passengers. Antyodaya Express would be the fully unreserved trains. The unreserved class coaches and the AC coaches in the long distance trains are the best example to show case the class divide and inequality in India. In these unreserved coaches, poor travel in a very pitiable condition. The fully dedicated trains with only unreserved coaches is indeed a move which was wanted since long but delivered now.


With the goal of ‘zero accident’, railways will eliminate all unmanned crossings in the next three to four years. Majority of the accidents involving railways occur at unmanned railway crossings. Besides, Train Collision Avoidance System (TCAS) will be installed in the trains to avoid head on collision of trains. All high density networks would be equipped with TCAS within next three years.

Ticketing System

Capacity of online ticketing window of the railways would be increased from 2000 tickets per minute to 7200 tickets per minute. During the tatkal hours, IRCTC website often faces issues and majority of time potential passengers are unable to book a ticket. Increase in capacity by more than 300% will definite bring a relief to the travellers. Also, now one can book the ticket with foreign debit and credit cards. This will improve the train usage by foreign travellers and expats. In order to curb the menace of touts, railways would install CCTV at tatkal counters of railway station. However, in most likelihood, it would not be able to deliver any positive results because touts are operating at the stations since long with the connivance of officials. Making the stations free of touts needs more resolve than CCTV cameras.

Connecting Northeast

Rail budget announcedbroad-gauge connectivity to the north-eastern states. The Lumding-Silchar section in Assam will connect the Barak Valley to the rest of the country. Manipur, Mizoram and Agartala would also be brought on the broad-gauge network. The northeast India was hitherto the most neglected part of the country. Until and unless a region is connected with the good transport system, fruits of development cannot usher. Providing rail connectivity in the northeast is not easy due to topographic challenges, and its investment requirements would be much higher.

But since Railways had already won the challenges of terrain in Konkan and Jammu and Kashmir, it would succeed in providing the last mile connectivity to the northeast. In future, railways may also contemplate a direct rail link between Dhaka and Agartala and with Myanmar as well. Rail connectivity with the neighbouring countries that are not inimical to Indian interests will increase trade and people to people contacts and ultimately will improve the economic lives of the people.

What rail budget failed to answer was the losses it is incurring due to the agitation. Recently, railways had to incur the losses of more INR20,000 crores due to agitation by Jat community which were demanding reservation in government jobs. Though anyone can get reservation in train irrespective of his caste, creed or religion, it is often the victim of the political protests. ‘Rail roko’ are the most common way of protests by trade unions, political parties, community leaders, students etc. Railways should consider up-gradation of Government Railway Police (GRP) on the lines of para military forces to deal with such situations.

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