• FEBRUARY 26, 2007

Railway Budget 2007-08: Key extracts

The budget activity has begun today with the railway minister Mr. Laloo Prasad Yadav, presenting the Railway Budget for 2007-08 a short while ago. Here are some of the key announcements made by the minister.

  • On the passenger business front, the minister has announced addition of 800 more coaches to popular trains. He has also proposed the introduction of 8 new Garib Raths. Other initiatives include facility for reservation of lower berths for senior citizens and women above 45 years traveling alone and increase in provision of special coaches for physically challenged passengers.

  • There is a relief for passengers traveling by AC coaches, as reduction in fares has been announced for AC First Class (3% and 6% for busy and lean season respectively), AC Tier 2 Class (2% and 4%). Besides this, the minister has also announced reduction in fares for all classes of high capacity new design reserved coaches by around 4% to 8% applicable to the AC Tier 3 and Sleeper classes.

  • Fares of second class non-suburban ordinary passenger and non-superfast mail/express trains would be reduced by Re.1 per passenger. Superfast charge on second class tickets would be reduced by 20% (from Rs 10 to Rs 8). These moves by the minister are seemingly to ward off, to a certain extent, the competition being provided by the low cost/budget airlines by wooing passengers back to rail travel by increasing the differential between rail and air fares.

  • Concession of 50% in second class for candidates appearing for main written examination conducted by SSC and UPSC has also been put forth.

  • On the industry front, the government has refrained from increasing freight rates given the competition from road transport. In fact, the freight rates for the movement of diesel and petrol have been reduced by 5%. Further, discounts upto 40% for open wagons plus discount of 20% during the lean season and 15% during peak season under Two Leg Freight Discount Scheme for covered wagons in up and down directions has been proposed.

  • Initiatives have been announced for targeting higher share in transportation of cement and steel (200 MT each by 2011-12). The minister has also aimed at a container traffic target of 100 MT by 2011-12.

  • Other initiatives on the anvil include plans for triple-stack container trains on diesel route and double-stack container trains on electrified route.

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