Railways contractors strike work including track maintenance. Though the work has come to a halt at under-construction bridges, the worst affected are the railway tracks whose maintenance has been outsourced to private contractors. Is passenger safety being compromised?
Over 90 per cent of the 10,000 odd contractors associated with the Indian Railways stopped working 10 days ago protesting against the government’s decision to impose 12 per cent Goods and Services Tax (GST) on services by way of construction, erection, commissioning and installation with retrospective effect. Though the work has come to a halt at under-construction bridges and other infrastructure projects, the worst affected are the railway tracks whose maintenance has been outsourced to private contractors.
Ashok Ahuja, Secretary of the Railway Contractors Association, said, “We do not have any problem with GST. In fact, we welcomed its imposition on July 1 but the government is charging 12 per cent GST from us in contracts that were awarded before July 1, 2012”.
“We work on a margin of four to five per cent but the government is now, all of a sudden, asking for 12 per cent tax on contracts that were awarded before July 1, 2017. Where will the contractor pay this tax from,” said Ahuja.
The union government in its order dated June 20, 2012 had exempted services provided by contractors by way of construction, erection, commissioning and installation to the Indian Railway from any kind of service tax. With the imposition of GST, 12 per cent tax is being charged on these services but contractors have stopped all work saying they would rather not take any fresh payment from the Railways.
The railways has outsourced a major portion of its track maintenance work to contractors which has also been stopped in most parts of the country. “Track maintenance is directly linked with safety of railway passengers but it seems no-one in the railways is bothered. We are, in fact, waiting for another tragedy to happen as most track maintenance works are not being carried out,” a railway contractor, who has stopped track maintenance work on the Bhopal-Ramganj Mandi line, told.
The association of railway contractors met Railway Minister Suresh Prabhu few days back but received only assurance. Newly appointed railway board chairman Ashwani Lohani was also approached but there has been no positive outcome.
A major impact is also being felt by the 3 lakh odd daily wage workers who work for the striking railway contractors across the country.