The authors of the letter state that they are deeply concerned that this decision includes hidden subsidies that may be passed on to the private corporates and MNCs by allowing them to use the infrastructure facilities, resources and skilled manpower of the units free of cost and, as if that is not enough, allowing them to manufacture and supply coaches/ locos at very high prices, much higher than the prices at which those production units are capable of supplying. This is nothing but allowing private corporates and MNCs to profiteer at the cost of the public exchequer, a matter that calls for an independent investigation.

Among the signatories are Thomas Isaac, former finance minister of Kerala, EAS Sharma former IAS officer, Dr CP Chandrashekhar, economist and Dr Prabhat Patnaik, economist.

The entire text of the letter may be read here:

To

Shri G C Murmu

Comptroller & Auditor General (C&AG)

Dear Shri Murmu,

The People’s Commission has come to know that the Railway Board is opening a backdoor entry to private corporates, Indian and foreign, to privatise profit-earning Railway production units. The four units targeted so far are

1. Integral Coach Factory (ICF), Chennai, Tamil Nadu
2. Marathwada Rail Coach Factory (MRCF), Latur, Maharashtra
3. Banaras Locomotive Works (BLW), Varanasi, UP
4. Dahod Railway Workshop (DRW), Dahod, Gujarat

There could be more production units in the pipeline for such backdoor entry for private companies.

What distresses us most is that each one of these units is already manufacturing coaches/ locomotives at highly competitive costs, whereas the prices quoted by the private corporates are much higher. One of the agreements entered into by the Railway Board (Agreement for Manufacturing-cum-Maintenance of 6000 HP Freight and 9000 KW High Horse Power Passenger Electric Locomotives at Varanasi) with a private corporate is not only one-sided but it permits it to make use of the infrastructure facilities, the skilled manpower, and the resources belonging to the said Railway production unit for manufacturing coaches/ locomotives.  The tender documents based on which private companies are chosen do not mandate their obligation to transfer technology nor do they limit the timeframe over which they carry out manufacturing activity using the Railway’s infrastructure and manpower. At the same time, the tender documents seem to permit the private companies to label the Vande Bharats with their brands, giving the impression that the Railways’ own production units have no role. The private corporates thus using the resources of the production units are not required to compensate the latter. The one-sided agreements signed by the Railway Board effectively amount to private corporates brazenly allowed to profiteer at the cost of the Railways without the Railways deriving any net benefits. This calls for an independent investigation.

The agreements signed or to be signed with the private corporates, Indian and foreign, cover 200 Vande Bharat train sets to be supplied over the next 3-5 years. For this purpose, those private corporates will use the facilities, resources and skilled manpower of ICF and MRCF, as well as the designs and drawings provided by RDSO, for which the latter will not get compensated, suggesting huge hidden subsidies that allow these private corporates to earn undue profits at the cost of the Railways.

An equally disturbing fact is that the average cost of manufacture of a Vande Bharat by ICF is Rs 104 Crores, whereas the corresponding price payable to the concerned private corporates is Rs 139 Crores at the premises of ICF, and Rs 120 Crores for manufacturing Vande Bharats at MRCF. In other words, the excess price differential is around 15%-34%, not taking into account the huge hidden subsidies. We note that ICF has already manufactured and supplied 40 Vande Bharats successfully run by the Railways and another 35 are in the pipeline. Had the Railway Board not forced ICF to surrender 5000 posts and had it cared to fill the existing 2000 vacancies, ICF could have supplied many more Vande Bharats with utmost ease at far lower costs.

The most bizarre justification put forward by the Railway Board to allow entry of private corporates is that ICF is “unable” to rise to its expectations and supply a higher number of Vande Bharats. This in itself exposes the motives underlying the Railway Board’s approach, as it is the Railway Board that has curtailed the capacity of ICF to supply more Vande Bharats by deliberately and mindlessly reducing its manpower.

Coming to BLW and DRW, since June 2022, the Railway Board has made attempts to call for bids from foreign MNCs to manufacture and supply 800 locomotives of 12,000 HP capacity at BLW and 1200 locomotives of 9,000 HP capacity at DRW over a timeframe of 10 years. The order for 1200 (9,000HP) locos went to an MNC for Rs 26,000 Crores, roughly twice the cost at which the same locos are manufactured by the Chittaranjan Loco Works (CLW) in W. Bengal. The MNC will manufacture only 120 locos per year, whereas CLW manufactures 400 locos per year. The Railway Board has already spent Rs 500 Crores on creating facilities at DRW to facilitate the MNC manufacturing the locos. The Railway Board spent this money to convert a railway workshop into a production unit. The MNC is likely to take advantage of that investment without having to compensate the Railways!

As far as BLW in Varanasi is concerned, after the original bid for 12,000 HP electric locomotives failed to evoke any response, the bid was revised three times to further make it attractive to foreign investors,  but without response.  As of now, the Railway Board has revised the bid further to restrict the loco capacity to 6,000 HP, offering BLW’s infrastructure and resources. The Railway Board has already started building the additional infrastructure within BLW premises to attract and accommodate the foreign MNC.

BLW and CLW can manufacture and supply 6,000 HP and 9,000 HP capacity locos for the Railways. CLW had also successfully built and tested a 12,000 HP electric locomotive prototype. We understand that the Railway Board recently asked BLW, CLW and Patiala Loco Works (PLW) in Punjab to surrender 535, 3661 and 1007 vacant posts respectively, which in effect seems to be a ploy to reduce their ability to manufacture and supply a sufficient number of locos for the Railways, so that the Board may provide backdoor entry for MNCs.

How the Railway Board is rushing into inducting Indian and foreign MNCs for manufacturing coaches/ locos seems to fit into the larger pattern of the present government indiscriminately outsourcing strategic works to private companies at the cost of national interest, by weakening the CPSEs deliberately by failing to fill vacancies at all levels, forcing them to allow private companies to exploit their infrastructure assets through “asset monetisation” and not allowing them to compete with private bidders lest they should outbid the latter.

In the specific case of Railways’ production units referred to above, they represent a rich legacy of self-reliance built assiduously over several decades of sweat and toil put in by the highly talented, committed employees of the Railways. Any responsible government interested in promoting self-reliance would do everything to strengthen the capacity and capability of each of those units to step up their manufacturing activity to match the rapidly increasing demand for railway infrastructure and rolling stock. We feel that it is highly imprudent on the part of the Railway Board to systematically dismantle that legacy to allow private companies, especially MNCs, to profiteer using the valuable railway assets through substantial hidden subsidies and earn huge profits by charging inordinately high prices.

Indian Railways, especially the production units mentioned above, have created a wide range of employment opportunities at ICF (Chennai), MRCF (Latur), BLW (Varanasi) and CLW (W. Bengal), developed highly skilled teams of committed employees and promoted self-reliance at each of those locations. Considering that the Railway Board has taken up back-door privatisation at each of those locations, we apprehend that the entry of private corporates, Indian and foreign, will progressively shrink employment opportunities for the local people. Indirectly, it will have a serious adverse impact on the recruitment of people belonging to the disadvantaged sections, which the private companies would put an end to. Clearly, the Railway Board has not applied its mind to such crucial socio-economically important concerns.

The railway employees’ associations have resisted the entry of private corporates in ICF and have been able to stop it for the time being, the agreement signed to date has not been revoked. While the Railway Board issued an order to ICF for supplying 50 rakes of 24 coaches each over a time frame extending up to 2026-27, we apprehend that the present government will renew efforts to induct Indian and foreign MNCs in all production units once elections are over.

The Railway Board has so far signed one agreement (Manufacturing-cum-Maintenance Agreement for Vande Bharat Trains) and the same continues to be valid on date. However, considering the tender conditions and the conditions stipulated in the agreement signed so far, we feel that the approach of the Railway Board to introduce private parties in the production units is quite clear and it is most certainly going to become a fait accompli soon, which will have serious adverse implications not only from the point of view of self-reliance but also from the point of view of the propriety of the Board. Allowing private companies to set up their shop within the premises of each of the above cited production units, using the units’ resources in an open-ended manner without compensating them and manufacturing and supplying locos and coaches at prices far higher than the costs at which those units are supplying is condemnable.

In conclusion, we feel that the Railway Board should review its approach to inducting private corporates and MNCs in its production units. It should fill the existing vacancies and give back the surrendered posts to enable those units to expand their capacity to be able to meet the rapidly increasing demand in the coming years. In our view, this is the only way for the Railway Board to strengthen its production infrastructure and promote self-reliance, not by permitting private corporates to take over the Railway infrastructure.

In particular, we feel deeply concerned that hidden subsidies should be passed on to the private corporates and MNCs by allowing them to use the infrastructure facilities, resources and skilled manpower of the units free of cost and, as if that is not enough, allowing them to manufacture and supply coaches/ locos at very high prices, much higher than the prices at which those production units are capable of supplying. This is nothing but allowing private corporates and MNCs to profiteer at the cost of the public exchequer, a matter that calls for an independent investigation.

We feel that this is a fit case for CAG taking advance cognisance of and conducting a comprehensive performance audit lest the entry of private companies should become a fait accompli imposing a huge cost on the Railways and its long-term public interest implications.”

The letter may be seen here:

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Privatising Indian Railways is anti-national: CITU

The post Stop backdoor entry of private players in Railway Production Units: Open letter to CAG appeared first on SabrangIndia.

Last week, the Indian Railways invited proposals from private companies to run 151 passenger trains on 109 pairs of routes across the country. The project would entail private sector investment of about Rs. 30,000 crore and is said to be done as an initiative to introduce modern technology rolling stock with reduced maintenance, reduced transit time, boost job creation, provide enhanced safety, reduce demand supply deficit in the passenger transportation sector and provide a world class travel experience to passengers.

Ministry of Railways has invited Request for Qualifications (RFQ) for private participation for operation of passenger train services over 109 Origin Destination(OD) pairs of routes through introduction of 151 modern Trains (Rakes).https://t.co/rUyBpOidQQ pic.twitter.com/ORSLx2w7zX

— Ministry of Railways (@RailMinIndia) July 1, 2020

The Union government has said that the private entity shall have the freedom to decide on the fare to be charged from its passengers and it shall be free to procure trains and locomotives from a source of its choice. It has also said that the scheduled maintenance of the trains will take place after a run of 40,000 kms. The project also proposes that no similar train will depart in the same origin two destination route within 60 minutes of the Scheduled Operation of the Concessionaires Train.

This program of the Indian Railways will be executed by 2023 and the proposal has garnered interest from Adani Ports, Tata Realty and Infrastructure, Essel Group, Bombardier India and Macquarie Group, Moneycontrol reported. Adani Ports today owns one of the largest private railway lines in India, one which spans 300 km and connects ports and other business hubs for cargo movement. It also set up its own subsidiary to focus on metro rail projects. In 2018, EsselInfraprojects Ltd won the first railway project for Rs 17.06 billion on the Eastern Freight Corridor connecting Howrah and Chennai mainline. In May, Bombardier India won the contract to supply 210 commuter and metro cars for the Delhi-Meerut Regional Rapid Transit System.

The announcement of the privatisation of these trains came after the Railway Minister had earlier continued to vehemently deny that the Railwayswould  beprivatised. Chairman of the Railway Board, Vinod Kumar Yadav, put out a video, probably in a bid to pacify passengers and railway unions, saying that 95 percent of the trains will be run by the Indian Railways and all their ticket prices will be fixed by the Indian Railways. He went on to say that private trains would only be an additional facility for passengers and fill in a deficit which is currently not being met by the Indian Railways. Through the video he keeps repeating that the common man will benefit from this and there will be no rise in ticket prices, but instead people will be able to avail better facilities.

भारतीय रेल द्वारा 151 निजी ट्रेनों के संचालन से यात्रियों के लिये ट्रेनों में सीटों की उपलब्धता बढेगी, इस विस्तार से रोजगार का सृजन होगा, यात्रियों को अच्छी सुविधा मिलेगी :
अध्यक्ष रेलवे बोर्ड, श्री विनोद कुमार यादव pic.twitter.com/IlKZIFe9qa

— Ministry of Railways (@RailMinIndia) July 4, 2020

However, there seems to be a discrepancy in this announcement given that the private players will be allowed to fix their own fares. Not just this, the Railway Ministry has also put out a tweet saying that it is not going to surrender any safety category posts required for train operations & maintenance. It had asked for a ‘review’ and freezing of jobs in the non-safety category posts, saying that it was ‘rightsizing’ and not ‘downsizing’.

Indian Railways is not going to surrender any safety category posts required for train operations & maintenance

Review is been done only for non safety category vacant posts so that addl. safety posts can be created for new Rly. Infra. Projects being developed at fast speed

— Ministry of Railways (@RailMinIndia) July 3, 2020

However, the non-safety category posts include thousands of employees who work as a peon, account clerk, steno, helpers, teacher, hospital attendant, hospital cleaner, cook, painter, fitter, mason, chowkidar and lab assistants among others. Newsclick reported that following the directive, many zones had started downsizing or holding recruitment, thereby affecting thousands.

Hence, to understand the on-ground ramifications of this announcement, Sabrang India spoke to Venu Nair, General Secretary of the National Railways Mazdoor Union. Nair said, “It has always been noted that Prime Minister Modi and Railway Minister PiyushGoyal have time and again said that privatisation of Indian Railways will not take place. Now that the truth is out, more than the people employed with the Indian Railways, I am concerned about the people from lower sections of the society. If this privatisation takes place, people who are using trains now, will not be able to do so in the future. For example, Mumbai’s local trains run on the harbour line, central line, western line, etc. and we charge nominally, around 18 paise per kilometer for tickets. In the same city, you have Ambani’s Metro Rail which charges almost Rs. 4 per km. Our trains run at 100 kmph while the Metro runs at 60kmph. Nobody can enter the Metro without a ticket or any concession, while Indian Railways offers concessions in more than 100 categories – for the media, senior citizens, army men, cancer patients, HIV patients, the differently abled, for children, for policemen and more. This is because we are Indian Railways. If this is privatised, do you think these concessions will remain? Where will the poor people go and how will they travel? People come from far-flung areas to the city to work as they can rely on trains which are the cheapest, safest and most reliable mode of transport. How will they travel?”

Explaining the precarious implications of the GOI’s decision, he added, “If you remember, the Railway Minister had announced a plan to convert the Central Locomotive Parel Workshop into a terminus. This workshop has been existing since the time of the British and holds assets of about 1,100 crores. Around 3,000 people work there and the government wants to finish it off? Why does Parel need a terminus? Mumbai is so congested. There are already five termini here – LokmanyaTilak Terminus, Bandra Terminus, Dadar Terminus, Bombay Central and Victoria Terminus and they want to make another one? For whom do they want to make it? If it’s for the benefit of IR and people of Maharashtra, we don’t have a problem. Most of the trains coming from the northeast and southeast directions to Mumbai, empty out (almost 60-70 percent) at Kalyan. If the government is so concerned, it should make a terminus there. Who is going to benefit with a terminus at Parel?”

“Nobody wants to listen to us or understand our point. If you remove our good routes and give it to a private entity it will only benefit the corporates. What will happen to the poor? The Tejas train that was run from Lucknow to Delhi is run on the same route that the Indian Railways’ Shatabdi Express runs on. The Shatabdi Express stops at 5 stations, while the Tejas stops at 3 stations. Our Shatabdi train, after stopping at 5 stations, takes just 5 minutes more to reach Delhi and the Tejas train charges twice the amount for lesser service. The profit is earned by the corporates but if the Tejas train is late, there is an arrangement made that the IR will pay passengers Rs. 100 if the train is late for an hour or Rs. 200 if the train is late for 2 hours. Why should the loss be borne by the IR if the profit is enjoyed by the corporates? Even for the Tejas they had said that no train would train 30 minutes before or after the Tejas train arrives and departs – was this to put the trains we’re proud of running, into the bin?” asked Nair.

Talking about unemployment issues, Nair said, “Indian Railways is the biggest employer. Our PM says we have more than 20 crore unemployed youth in the country. Don’t they need jobs? If you kill the Indian Railways, how will these youth get jobs? Even the Class IV employees in the IR get at least Rs. 25,000 as salary. Shouldn’t we give them a chance in such government institutions? The government wants to finish such jobs and employ 3 people for Rs. 8,000 each and say we provided employment. But what other security benefits will such people get? If you give all benefits and ensure that a person can manage their lives in a dignified way, we will understand. But Rs. 8,000 is not enough to survive. I don’t understand why the government is discriminating against the poor and the working class?”

He also pointed out, “Today, during the pandemic, apart from the media, all those working on the ground are government employees – banks, police, trains, frontline workers, etc. Had the unions not protested privatisation from the start, the IR would’ve already been privatised by now. The government is taking all the credit for the return of migrant workers back to their homes. If the trains had been privatised, would these migrants have ever returned home? Today, the IR has made special coaches to treat people in the pandemic. Would the private players do so? This is something to think about.”

“I think the fight we’re going to undertake next, shouldn’t just be for the employees of the IR, but actually ensure that IR lives and exists for the public. If the people fight with us, we will definitely be successful. I am not worried about this generation of employees in the IR, but the next generation. The government has issued circulars to all zones to surrender 50 percent of all non-security related vacancies. What does this mean? It means you’re eating up the jobs of the future generation. For each vacancy lost, one person loses employment,” he added.

Speaking about the safety compromises, Nair said, “Our coaches are maintained after every 4,000 km. But now it is said that with the coming of private entities, the trains will be maintained after a run of 40,000 kms. This is where the safety will be compromised. You will not require people to look after operations there. Sometime ago, a boulder had fallen on one of the tracks in the southeast direction during the rains. The government had removed personnel who used to specifically look at operations on these tracks and replaced them with CCTVs. But a CCTV will tell you that the boulder has already fallen. But those people who have lived their life studying those tracks used to alert us of any disasters. In other countries, technology is upgraded because there’s no manpower there. Here we don’t need privatisation because unlike other countries, we don’t have a shortage of passengers. There’s a shortfall of trains, which we can make too.”

Making a scathing statement against the government, Nair said, “The government sees railway employees as a liability because they have to offer benefits and listen to the unions who fight for the rights of the people. They want people who will just listen to them and exploit them. This is a well-planned strategy. In 1999-2000, during the Vajpayee government, there was a Rakesh Mohan Committee that said that the non-core activities of the Railways should be privatised. As per them, only drivers and operating departments like station masters came under core activities. We had started opposition then itself. Then came the BibekDebroy Committee during PM Modi’s regime that coaches and locomotives too could be privatised to increase competition. What competition are they talking about? Making men and women stand at the entrances of private trains to greet passengers is this what privatisation is about? Are these people even given money or are they treated like contract labourers? This even goes against our ethics, dressing up young women and touting them to be airhostesses just for customers.”

Concluding on a concerned note Nair said, “I fear that in the coming years, the services for the poor and middle class will be eliminated altogether. Maybe the suburban services will be shut. The Metro railway is like an alternative arrangement being set up. If people say we have no way to travel, the government will point out to the Metro and say there is. We can only protest now. I think the Railways should have nominally increased the fare as it would help maintain our infrastructure and other services. If we call for an increase in prices, there’s a protest and I’m sure these protests aren’t done by passengers. This is done by those who want to keep their vote bank. I will keep fighting till I can. Not fighting means you don’t have love for the railways or your country or the future generation.”

While the disparity between what is being said and what is happening on ground is stark, what is of more concern is the cultural divide this decision is going to bring about. Currently, the private entities may only be given 5 percent, it will be no surprise if this number balloons in the future, and this, coupled with exorbitant fares will only further push the underprivileged on the fringes of society.

The post “Fighting rail privatisation is a battle for universal access to reasonable travel and employment”: NRMU Gen Secy Venu Nair appeared first on SabrangIndia.

The Centre of Indian Trade Unions (CITU) has reacted strongly to the Central government’s Request For Qualification (RFQ) extended to the private corporates, both Indian and international, for operating passenger train services over 109 pairs of stations. The CITU has called this an “anti-national” move by the government. According to a statement issued by Tapan Sen, General Secretary. The CITU has alleged that this move has put “Indian Railways, the pride of India and its precious wealth, on sale”.

Sen stated that it was “appalling that the government chose the lockdown period to fast track this anti national policy.” The 109 pairs of high speed trains have been formed into 12 clusters and will be run across the railway network, by the drivers and guards employed by the Indian Railways. Apart from that all the other employees are likely to be of the private operators. These private operators will be responsible for procuring, operating and maintaining the trains and safety of the passengers.  

The CITU has objected to this and said the Bharatiya Janata Party (BJP) led government has already permitted 100% FDI in manufacturing and maintenance of rolling stock, signalling and electric workers and dedicated freight lines. “In the name of redevelopment of railway stations it has started handing over the railway stations along with the huge amounts of real estate to the private corporates,” it alleged, adding that the private players “will only work towards maximising their profits, and not providing a cheap mode of transport to the people.” It added that most travellers availing railway transport will be subjected to a heavier burden of unaffordable railway fares.  

CITU has highlighted that the Union government’s claim of a Rs 30,000 crore investment and employment generation “has no meaning as the drainage due to loss of revenue to the Indian Railways in these revenue generating routes and high speed trains will more than neutralise the said hypothetical figure.” CITU also said that the potential employment lost due to privatisation of Indian Railways, in its workshops, maintenance units etc will be much higher than any fresh employment created by the private players. “Most of the jobs that will be created will be precarious jobs, not permanent jobs with decent wages and social security,” it added.  

CITU has called upon the major railway employees’ unions to “build a strong struggle of resistance and defiance to this anti people and anti national move of the BJP government”. 

It cited the example of coal workers who have “already shown the way of such defiance and resistance to move for privatisation of the coal sector through the massive and total three day strike on June 2-4 July 2020.” CITU states that even defence employees may soon “resist and defy privatisation of the sector,” and will express “support to go on strike in their strike ballot.”                                                                                                

In what is one the first ever large scale strikes during the national lockdown, around 5.3 lakh coal workers went on a strike across the country on July 2 in response to a call given to oppose “the move to privatise the country’s coal industry and promote commercial mining and trading of coal by private sector including foreign entities,”. CITU called the privatisation proposal “disastrous for the country’s energy security and productive operation of the country’s industrial economy as a whole.” It claimed that the strike had massive participation in all the subsidiary companies under Coal India Ltd, viz; Eastern Coalfields Ltd(ECL), Bharat Coking Coal Ltd (BCCL), Central Coalfields Ltd (CCL), Western Coalfields Ltd (WCL), South Eastern Coalfields Ltd (SECL), Northern Coalfields Ltd (NCL), Mahanadi Coalfields Ltd (MCL), North Eastern Coalfields Ltd (NECL) and CMPDIL and also in Singareni Collieries Company Ltd (SCCL).

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The post Privatising Indian Railways is anti-national: CITU appeared first on SabrangIndia.

After vehemently denying the entry of private players, the Indian Railways has proposed a plan to allow private players to run their trains on around 100 routes across the country, mostly for tourism purposes.

The proposal was also mentioned by Finance Minister Nirmala Sitharaman while discussing the Budget 2020 where she said that Rs. 12,000 crore was allocated for the construction of new railway lines, Rs. 2,250 crore for gauge conversion, Rs. 700 crore for doubline, Rs. 5,786.97 crore for rolling stock and Rs. 1,650 crore for signaling and telecom among other budgetary allocations.

The announcement of the same has garnered widespread support from both, global and local companies. It has been reported that more than two dozen global companies including Alstom Transport, Bombardier, Siemens AG, Hyundai Rotem Company and Macquarie have expressed their interest to be a part of the plan. Among local players, Tata Realty and Infrastructure, Adani Ports and SEZ, Hitachi India and South Asia, Essel Group and Indian Railway Catering and Tourism Corporation (IRCTC) have come forth and expressed their interest in the venture.

The details of the plan

The list of the 100 routes that these private trains will run on has already been decided by the government. These include high-frequency routes like New Delhi to Howrah, Shalimar to Pune, Chennai to New Delhi, and Mumbai to New Delhi.

The private trains running on a particular route are set to have a head-start of 15 minutes on the route where even normal trains would run. The document read, “No similar scheduled regular train will depart in the same origin destination route within 15 minutes of the scheduled operation of the concessionaires (private players) train.”

The proposal also says that the private companies will have the autonomy to decide the fare on the particular route the train will run and they will be also be responsible for financing, procuring, operating and maintaining the trains.

It has also been announced that the Kisan Rail – national cold supply chain for perishables including meat, milk and fish will be set up by the Indian Railways through the Public-Private-Partnership (PPP) arrangement.

Why railway unions are opposing the plan

Ever since the government has announced its intentions of privatizing the Indian Railways, the unions have vehemently opposed the same.

The Dakshin Railway Employees’ Union complain that first and foremost, no announcement of filling up the 3 lakh vacant posts in the Indian Railways.

Union assistant divisional secretary V Ramkumar of the Southern Railway Mazdoor Union told The Hindu that the with the decision of giving away the profitable routes to the private sector, will leave the unprofitable routes to the railway administration eventually  making it face a huge loss and go down the path that BSNL did.

R Sankaranarayanan of the Dakshin Railway Employees’ Union said that the decision to operate Kisan cargo trains won’t benefit the farmers as expected because the private players would not offer them any freight fare concession during transportation.

The most adverse effect of privatisation will be the burden on passengers who will have to pay more for tickets than what they cost now. People from the socio-economically backward classes will not be able to avail of the services offered by the private trains. There will be no concessions offered to students, senior citizens or the disabled and the fares would potentially go up during peak season as the government wouldn’t have a say in regulating them.

With the anti-passenger and profit-centric approach of the Indian government, the privatisation of the Indian railways has begun. It is set to leave the far-flung areas out of its reach because the privatisation of routes to such areas will not be profitable to the private players.

Instead of focusing on the safety and comfort of the more than 13,000 trains on the network, the ruling government has once again shifted its focus from the needs of the common passenger to serving the needs of capitalist top bosses who exploit the marginalized for their profits.

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The post Ticket prices to go up as Hyundai, Tata, Adani line up to run private trains appeared first on SabrangIndia.

Image Courtesy: DQ India

The Indian Railways is moving fast towards total privatisation as seen in the light of the Centre's decision to auction 23 railway stations across the country. Centers’ new move came as a part of Public Private Partnership (PPP) projects.

The stations will be allocated to the private firms through auction. The firms getting tender will be allowed to modernise the stations. As part of the modernisation of stations, Railways will allow developers to build malls, cinema halls, hotels and specialty hospitals within the station premises. 

The financial model for the redevelopment work has been framed in a way so that the government doesn't incur any expenditure as the developer would be rebuilding the railway stations and maintaining it for 15 years.

In return, the firms would be granted 45 years’ leasing rights for the commercial properties developed at these stations. It gives them right to commercially exploit railways’ land. The firms will also be allowed to maintain all the station facilities like power, platform maintenance, parking, food stalls, retiring rooms, etc.

The redevelopment of the stations is occurring through different phases. In the first phase, the responsibility of redevelopment had been given to Indian Railway Station Development Corporation (IRSDC), a joint venture Company of Ircon International Limited and Rail Land Development Authority.

A senior official from Indian Railways stated that the revamping work of Habibganj Railway station is likely to be commenced soon.  For the facelift at Habibganj, developer Bansal Group has obtained financial loans of a total 400 Crores. The business firm will take care of all the station facilities like power, platform maintenance, parking, food stalls, retiring rooms, etc.

Also Read : Not Much to Gain & Much to Lose: Selling Indian Railways Bit by Bit

In the second phase of redevelopment 23 Railway stations will be auctioned.  Kanpur Central, Allahabad, Lokmanya Tilak, Pune, Thane, Visakhapatnam, Howrah, Kamakhya, Faridabad, Jammu Tawi, Udaipur City, Secunderabad, Vijayawada, Ranchi, Chennai Central, Kozhikode, Yesvantpur, Bangalore Cantt, Bhopal, Mumbai Central, Bandra Terminus, Borivali, and Indore are those stations.

Eyeing on Udaipur, Howrah, Indore, Secunderabad, Pune, and Faridabad railway stations, Malaysia’s state-owned Construction Industry Development Board (CIDB) will participate in the auction . It is said to be one of the potentially big Foreign Direct Investment in railways. According to the officials from Railways, apart from CIDB, many Korean and Japanese companies have expressed their interest in the redevelopment project. Through, liberalizing the policies, Indian Railways will become a fertilized soil for Foreign Direct Investment.

Earlier, in 2014 India allowed 100% FDI in railways infrastructure through automatic route. Through this foreign companies have established two rail loco factories in Bihar with an investment of Rs 3500 crore. According to the railway official, various investors from Japan and South Korea have also expressed in the station redevelopment projects and the government has queued up 400 stations for redevelopment.

The private participation in public sector indicates the implementation Bibek Debroy committee report. The pro-privatisation wing is substantiating their point on the basis of it. The report favored private participation which is said to be the key to increase the efficiency of the system. The committee has also looked at the railway restructuring experiences from multiple countries, including Japan, the United Kingdom, Germany, Sweden, Australia, and the USA, as examples.

Indian Railways moves about 2.3 crore people and 3 million tons of goods every day.  The majority of the Indian populations, who cannot afford private vehicles, rely on the public transportation system. Railways are the most viable mode of transport for this section of the society. Millions use railways which connect geographically diverse population, each day.

Connecting the remotest corners of the country the railways runs 12,617 trains which carry both passengers and freight. Privatisation will affect the economic friendly transportation and connectivity to these areas. Preference for profitable route will result innegligence of the non-profit yielding routes.

Privatisation will also affect employees in the railways, including 14 lakh employees and almost as many pensioners.

Indian Railways which focuses on the service of the society will become a money yielding machine through privatization. With the intervention of the private sector, the fares may be hiked.  The privatization will also lead to market monopoly. Monopoly through the private sector may tend to cause the troubles include low accountability, lack of responsibility, producer-centric approach, exploitation of the poor, etc.
 

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