RailEnquiry

The diesel price hike will entail an additional expenditure of Rs. 3300 crore annually. Notwithstanding the severe blow they have had to bear on account of the steep hike in diesel prices for bulk purchasers, the Railways are unlikely to revise passenger fares or freight rates in the immediate future.With budget preparations under way, it is unlikely to initiate any action now to make up for the loss inflicted by the Rs.10.80 a litre rise in diesel prices.“It will have to wait till the Railway Budget,” said people who call the shots at the Rail Bhawan.The Railways will have to shell out 25 per cent more on its diesel outlay, which currently is about Rs.15000 crore.It will rise by about Rs.3300 crore on an annual basis, it was stated. The Railways, incidentally, consume electricity worth Rs.8000 crore annually.Railway Minister Pawan Bansal had effected a passenger fare hike on January 9 hoping to rake in an additional Rs. 6600 crore annually to close the widening income-expenditure gap and address issues of passenger amenities and safety. Virtually half that amount will now be taken away by the oil marketing companies.Realising that they would no longer be able to manage without making up for variance in diesel prices, Railway officials are speeding up the process of establishing the Rail Tariff Authority. The functions have been decided. Now the question of structure is under consideration.It is not yet clear whether the decision of the four-member committee, including the chairman, would be recommendatory or mandatory on the railways.The silver lining for the Railways is that it might take the government some time to complete the process of deregulating diesel prices. They are likely to be increased steadily over a period of time, offering the railways a cushion from volatility.