Why Rs 8.56 lakh crore investment in Railways is not a big deal

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Railways

Railway Minister Suresh Prabhu recently commented that anybody having the answer to the question of how to manage Indian Railways deserves a Nobel Prize.

That’s because India was content with using its massive rail network to move people and goods from point A to B and appease political constituencies in the process.

On the other hand, the transcontinental railroad expanded the boundaries of habitable settlements in the United States in the latter half of the 19th century; and learning from history, China is now using the might of the rail tracks to connect several Asian economies under its ‘One Belt, One Road’ project, pumping in $6 billion.

Of late, the urgency of the opportunities missed is being realised in India.

From a meagre Rs 24,307 crore of average yearly spending during 2004-2009, capital investment reached Rs 58,718 crore in FY15 and has touched Rs 121,000 crore in FY17. Under the current transformation project of the Prime Minister Narendra Modi-led government, plans are to invest Rs 8.56 lakh crore in the next five years. Of this, about Rs 1.9 lakh crore each would be spent on network expansion including electrification and network decongestion, while Rs 1.27 lakh crore and Rs 1.02 lakh crore would go towards improving safety aspects and increasing supplies of locomotives, coaches and wagons, respectively. Station redevelopment gets another Rs 1 lakh crore.

The above-mentioned figures appear big only because in India, in the 64 years between 1950 and 2014, while freight loading grew by 1,344% and passenger kilometres by 1,642%, route kilometres went up by a meagre 23%.

A lot needs to be done, and at a very fast pace. Only then will Indian Railways be able to catch up with its global counterparts.

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