Many Railway projects don’t have a deadline

The Indian Railway is the world’s largest government owned railway services provider with 64,600 route kilo meters track carrying about 23 million passengers and hauling nearly 2.67 million tonnes of freight every day. Despite having such a mammoth infrastructure and huge operational capability, its track record in implementing projects is far from satisfactory. Today Railways is implementing many projects which do not have any deadlines! There are few projects which were commenced in 1980’s and are going on even today without any deadline. According Railway Ministry sources targets are fixed every year depending upon availability of resources and target for the projects have also been extended due to paucity of funds. “Projects are progressing as per availability of resources” says the Railway Minister Mallikarjun Kharge. As resources are limited, the projects are prioritized for execution based on operational needs. Priorities change with the change in Railway Minister.

It is just a case of biting off more than one can chew where Railways go on announcing new projects year after year without considering resource mobilization or project’s viability. Most of the Railway projects are held up or are progressing at snail’s pace due to shortage of funds. As on 01.04.2013, there are 368 ongoing railway projects consisting of 156 New Line, 43 Gauge Conversion and 169 Doubling projects having a throw-forward of Rs. 1,78,216 Crore.

An outlay of Rs 5.19 lakh crore including Gross Budgetary Support (GBS) of Rs 1,94,221 crores has been approved for the 12th Five Year Plan. However, the investment in the first two years of the Plan has been on the lower side mainly due to less allotment of GBS. GBS allotment has been Rs 25,367 crore in 2012-13 (Revised Estimate) and Rs 27,102 crore in 2013-14 (Budget Estimate). Investment in New Lines is financed primarily through GBS. Investment in New Lines in 2012-13 is Rs 6057 crore (Revised Estimate) and Rs 6100 crore in 2013-14 (Budget Estimate) against total plan outlay of Rs 35000 crores due to the lesser allotment of GBS.

If the latest figures give indication, things may not improve substantially even during the current Five Year Plan. In the first 2 years of the 12th Plan it was targeted to achieve construction of 951 kms. of new lines, 1405 kms. of doubling, 980 kms. of gauge conversion and 2617 kms. of railway electrification. Out of this, 501 kms. of new line, 605 kms. of gauge conversion, 705 kms. of doubling and 1317 kms. of railway electrification have been completed in the first year of the Plan(2012-2013).

There seems to be no solution to the problem the Railways is facing, at least in the foreseeable future and it may only compound in the coming days as its earnings targets are revised downwards due to slowdown in the economy. In 2012-13 earnings targets in passenger and goods segment were revised downwards by Rs 6867 crore partly due to roll back of passenger fare increase and slower growth freight traffic. During the 11th Plan, against original target of 1100 million tonne, only 969 million tonne freight loading could be done. Situation is unlikely to improve during the current year either. But that may not deter the political leaders from announcing new projects with most of them having no deadlines.