In an unpopular decision, the railway passenger fare was increased by 14.2 per cent in all classes while freight charge was hiked by 6.5 per cent with effect from Friday
The railways sought to correct the long running distortion in the fare
structure by hiking passenger fares by 14.2 per cent across all classes
and freight charges by 6.5 per cent. The increase takes effect
immediately.
The previous government had decided to hike fares from May 20, but its
implementation was stayed because the announcement was made on the same
day as declaration of election results.
However, the speed with which this government took the decision caught
senior railways officials by surprise because just a day earlier,
Railway Minister Sadananda Gowda had told them that some rounds of
consultations were still pending.
Senior officials said the hike in passenger fares will help pare down
the diversion of profits from the freight to passenger segment.
Successive Governments have shied away from biting the bullet on
passenger fares because of fears of public dissatisfaction.
As a result, passenger hikes in previous years, especially in the more
patronised second class and suburban travel, were either rolled back or
of amounts that were lower than planned. The railways moves about 600
crore passengers every year.
While Opposition parties opposed the hike, senior officials said this
will partially restore railways financial health in both mid and long
terms. For now, it will leave an adequate amount to modernise existing
infrastructure and build new one. In the long term it will help stave
off the financial predicament faced by the country's largest single
employer when the Sixth Pay Commission was announced.
Railway passenger fare hike by 14.2%, Politicos react
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