Pvt sector, foreign investors get ticket to ride on Modi's bullet train

  Focus Shifts From New Projects To Consolidation, Modernization, Passenger Services Rail Budget Shuns Populism, Will FM Follow Suit? Railway minister Sadananda Gowda used his budget on Tuesday--the first major policy showcasing of the Modi government to signal its intention of using private sector investments, both domestic and foreign, as the prime engine of growth and modernization. Having got rid of the difficult part by hiking rail fares and freight charges late last month, Gowda could focus his budget speech on the new government's vision for the railways, and he did just that. The government's vision clearly has a major role for the private sector in everything from new projects and freight terminals to cleanliness and food on trains and at stations. As Gowda's speech made clear, "It is our target that the bulk of our future projects will be financed through PPP (public-private partnership) route". He argued that while hikes in fares and freight charges were necessary to sustain financial viability, it would be "unrealistic" to depend solely on such an approach to raise the resources needed for modernizing the prime national transporter. That's why , the minister said, his ministry was seeking Cabinet approval for allowing foreign direct investment in the sector. Gowda was at pains on Tuesday to point out that successive governments in the past had announced new projects with abandon--falling prey to the "nasha (intoxication) of claps--but had been lax in implementing them to the extent that some were pending for three decades. In contrast, he said, the focus now would be on prioritizing projects. In particular, doubling and trebling of lines to decongest major routes would get the nod ahead of new lines, which have typically been unviable. Modi takes ownership of Rail Budget As Gowda drew flak for not presenting a populist budget, the PM stood firmly behind him. "This budget will help accelerate the country's growth, modernize railways and provide safety and better amenities to passengers... Railways would have taken the country to a new growth trajectory had it been fully harnessed. Anyway, it is better late than never," Modi said in a robust defence that was interpreted as a pointer to the Union Budget. P 14 FULL COVERAGE: P 2, 3, 12, 13, 14 Sensex tanks 518 pts, sharpest in 10 mths, P 23 In keeping with this line of shunning populism and in a radical departure from historical practice, the minister did not announce any new projects in his budget, though there were a slew of new trains (including those announced by the UPA in the interim rail budget) and extensions of existing ones. Gowda also castigated earlier governments for failing to raise passenger fares and thus creating a situation in which the loss per passenger kilometre had risen from 10 paise in 200001 to 23 paise in 2012-13. Describing the noughties as the "decade of golden dilemma ­ the dilemma of choosing between commercial viability and social viability", Gowda said while the Railways would continue to fulfill social obligations, doing so beyond a point was "not possible without compromising on efficiency and safety". Hence, he said, rail fares and freight rates will be adjusted for changes in fuel prices periodically. Despite the pro-corporate and pro-reform tone of the rail budget, stock markets reacted adversely with the sensex shedding 518 points, its biggest single-day decline in 10 months. The slump was attributed by market analysts partly to the absence of details in the budget speech. Also, while corporates and markets are looking forward to greater fiscal discipline, there's a worry that a stricter watch on government spending could lower demand and hence hit growth. The political opposition as well as the railway unions, not surprisingly , reacted sharply to the budget, with some dubbing it 'elitist' and others decrying the move to 'privatise' the railways. The new-look railways, Gowda promised, would include a bullet train between Mumbai and Ahmedabad, highspeed trains on nine sectors, a greater focus on cleanliness and decent food and further improvements in the e-ticketing system. They would also see some stations being developed along the lines of the new airports through the PPP route. Corporates will not just have a role to play in developing new freight terminals, they could also adopt stations and take care of their cleanliness and maintenance. NGOs and charitable institutions too could do so. CCTVs will be used to monitor cleanliness at stations. Food courts at major stations, where regional cuisines would be available, and precooked meals on board from reputed brands are among the promises on the catering front. Not only will tickets be available for booking online, the facility would be extended to booking trains, coaches, or seats. Online booking of retiring rooms will be extended to all stations in 2014-15, the minister promised. Business travellers will also, on some select trains, be able to use workstations for a fee. For the handicapped and elderly, the service of battery-operated carts will be extended to cover all major stations. Safety of women too found a mention, with the rail mantri saying 4,000 women RPF constables would be recruited towards this end. Also, "coaches for ladies will be escorted" and additional care would be taken of women travelling alone.  

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