Sources say railway has no option but to increase prices as its proposed safety fund did not get a favourable response from the finance ministry.
New Delhi: Train tickets for passengers are all set to become costlier as the Indian Railways is contemplating increasing rail fares to mobilise resources for its special safety fund. The increase in fares is being planned to raise resources after the finance ministry rejected the proposal of the safety fund.
According to the railways’ proposal, the Safety Cess would be utilised to help generate funds for eliminating unmanned level crossings, upgrading signalling systems and for strengthening tracks in a bid to prevent mishaps. Railway minister Suresh Prabhu sought Rs 1,19,183 crore for creation of the special fund called Rashtriya Rail Sanrksha Kosh, which would take care of the functioning of the safety works.
However, the proposal did not get a favourable response from the finance ministry, and it was asked to raise resources by raising rail fares. Now, the finance ministry will fund 25 percent of the resources and the rest (75 percent) would be raised by the railways.
“Though the railway minister is not in favour of raising fares at this juncture when passenger bookings are falling and fares of AC-2 and AC-1 are already on higher side, the reluctance of finance ministry to provide a bail-out package has left the minister with no option,” a source was quoted as saying by the agency.
As per the proposal, taxes for sleeper class, second class and AC-III tier will be higher when compared to the tax on AC-I tier and AC-II tier. A final decision on this matter is yet to be taken.
Since the railways has decided to increase the average speed of trains, it is necessary that the rail track and rail bridges are also strengthened, the report added.