Lack of competitiveness is one of the main reasons for the poor performance of the Indian Railways in the recent times. A rough estimate tells that India’s biggest public sector undertaking is losing INR 1 from every rupee earned from the commuters, which effectively means that Indian Railways pays a 50 per cent subsidy. Many may argue that the amount of subsidy being paid by the Indian Railways is not much considering the huge social responsibility it carries on its shoulders as the lifeline of the nation. There has been demand for hiking passenger fares for a long time now to cover up the loss. Privatization of the railways is another demand raised by the supporters of liberal economy, advocating a market that is totally free from any governmental restrictions. But all these proposals are unlikely to pull the railways out of the issue as the suggestions are merely cosmetic in nature. In a big and developing nation like India, the railways cannot get rid of its social responsibilities, considering the fact that rail travel is far cheaper than road transport, and any attempt to hike the train fare can be counter-productive. Instead, it should look for other avenues to increase the revenue so that it does not remain dependent on huge budgetary support.
Here comes the question of competitiveness, which the Indian Railways lacks despite being faced with several hurdles over the last couple of decades. For instance, Indian Railways is the highest employment provider in the country but it has been forced to reduce the number of intake due to financial constraints. The situation is such that even some important aspects of rail traffic movement have been outsourced to cut operational cost. This is dangerous as rail operation requires specialized hands; it should not be entrusted to private parties under any circumstances to ensure passenger’s safety. Fingers have been pointed to lack of manpower for the increase in the number of rail accidents and delays. The situation demands initiating recruitment to solve manpower issue as well as ease the burden of unemployment.
Clearly, the Indian Railways is facing a dual challenge of providing quality service and social duties. To meet the challenge, the railways can take a cue from the strategy it has adopted- increasing freight transportation by 40 per cent with the introduction of a separate freight corridor, along with a couple of measures. It can also increase revenue by aggressively publicizing the facilities it can offer to business houses to reach every nook and corner of the country. It is time for the railways to change its operational strategy to serve the nation effectively.
