However Union Railway Minister is optimistic about the Indian economy growing to $20 trillion in size over the next 20 years which will help revamp and upgrade the Railway system in India
Kolkata: Railway Minister Suresh Prabhu on Friday equated the Indian Railways to a patient in an intensive care unit (ICU), saying that the state-owned transporter is hit by “neglect and lack of investment”.
He said the government would spend $120 billion in the cash-starved public transporter in the coming five years.
“Because of neglect over several years, railways is suffering,” Prabhu said at the Eastern Railways headquarters in Kolkata.
Prabhu said that the ministry is taking various measures to set things right, but the results will take some time to become evident. “You cannot increase the number of trains or rolling stock with the given infrastructure,” he said.
Explaining the current condition of Indian Railways, the minister said an “ICU patient cannot be expected to join a marathon race against the Chinese railway now”.
“A marathon cannot be done by an ICU patient and today’s Indian Railway cannot be compared tomorrow with Chinese railway,” Prabhu said earlier at a Bharat Chamber of Commerce session.
He stressed that “the government needs time” to fix the problems currently faced by the railways.
“Many of the problems that we face today is because of the lack of investment in the past and also because modernisation has not been initiated in the railways,” Prabhu said.
Earlier this month, the minister had said that Indian Railways was planning to announce quarterly financial results, similar to listed companies, to enable raising of funds in a big way.
By doing so, the world’s fourth largest rail network intends to bring in more transparency in its financial operations. At present, information on accounts related to the railways is announced in the annual railway budget.
To reach one trillion (USD) GDP mark, it took India 20 years, but it added the next trillion in just six-seven years. Our economy can double in every six to six-and-a-half years, Prabhu said, adding that with the inflation in check and a prevailing conducive environment, the economy was looking up and foreign direct investments were increasing.
“There is a tremendous respect among investors for the efforts of the Prime Minister who are eager to invest in India,” Prabhu said.
Speaking about democracy, he said despite alternative views in a democracy, “we should pursue growth to eradicate poverty”.
“In a democracy, alternatives should be discussed but, at the end, a final decision has to be arrived at,” he said.
“We cannot be ambiguous about our goals. It is essential that concerted efforts are made and we have a comprehensive strategy to reach our goal, which is achieving inclusive growth coupled with elimination of poverty and corruption,” the minister added.
Ministry trying to solve wagon procurement issue
Suresh Prabhu opined that the Indian Railways was not getting enough cargo though it has a capacity to handle 1.2 billion tonnes annually. He said the problem was an issue external to the railways sector.
“We are geared up to handle cargo of up to 1.20 billion tonnes this year… but we are not getting enough cargo,” Prabhu said. “The next working season, which starts mainly in October, is the time when we have the pick up in demand for cargo. I hope the demand picks up and we are able to post better results for this year,” the Minister added.
Prabhu described Railways as the most eco-friendly form of transport which is a key component of the ‘Make in India’ programme.
“By improving physical connectivity, the Railways is significant to economic growth and can add 2-3 per cent to the GDP,” he said adding that the operations needed to be efficient and commercially viable.
The Indian Railways is trying to resolve the logjam in wagons procurement created by a significantly undercut bid for this financial year. Prabhu said the Railways was trying to sort out the “unique problem” of procurement of wagons caused by a very low bid at the tender for 8,509 wagons for 2015-16.
“The bid was so low that it undercut all other bidders,” he said. It created a unique problem as it was lower than the production cost. As a result, no other wagon maker was ready to supply at that rate.
“We are actively trying to sort out the problem,” the Minister said.