Bill for Independent Rail Regulator likely in the current Parliament session

Emboldened by the BJP’s success in the Assembly polls, Centre is keen to keep Railways to be free of undue Political interference.

NEW DELHI: A bill for an independent railway regulatory body is likely to be placed in Parliament in the current session, freeing the railways from political interference in passenger fares and freight rates as the Narendra Modi-government cranks up reforms, emboldened by the BJP’s success in the Assembly polls.

While the Railway Board was in favour of setting up such an authority through an executive order, the NITI Aayog had pitched for legislative approval to ensure its independence, sources said.

The rail development authority will have legislative backing similar to the Telecom Regulatory Authority of India. The body will be responsible for fixing the fare structure, besides setting efficiency and performance standards and dissemination of information.

The authority shall also look to protect the interests of consumers, ensure service quality, promote competition, encourage market development, efficiently allocate resources and provide non-discriminatory open access to dedicated freight corridors.

The body may also be entrusted with the task of regulating private investment and resolving disputes.

The authority will consist of a chairman along with four other members with experience in railways, infrastructure, finance, law, management and consumer affairs.

The setting up of an independent authority is an attempt to reduce tinkering with passenger fares, which has been based on political considerations rather than sound economic principles. The cross-subsidisation of freights has resulted in the railways losing market share to road.

Poll fillip

The success in the Assembly polls would give the government much needed political will after the merger of rail budget with the general budget to carry out larger reforms such as rationalisation of passenger and freight tariff, cutting down subsidy and reduce populist pressure on new lines and trains.

The idea, first proposed by the Rakesh Mohan Committee in 2001, was given a fresh lease of life by the Bibek Debroy panel in 2014. This comes at a time the railways’ loss from the passenger segment mounted to Rs 30,000 crore in 2015-16 because of increasing input costs and the decision to not hike fares over the years.

The concept note, prepared by the railway ministry, justified the setting up of the authority.

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