In a bid to lure investors, the government of India has decided to allow private companies to set passenger fares once they start operating train services in the country, as Prime Minister Narendra Modi-led administration opens up the railway network.
"Private players have been given the freedom to fix fares in their own way," VK Yadav, chairman of Railway Board, said adding that, "air-conditioned buses and planes also operate on those routes, and they have to keep that in mind before setting fares."
The railway ministry is confident of bringing in investments of more than $7.5 billion in the next five years.
Railways is India’s lifeline and crores of people – rich and poor – use this relatively reliable and cheap medium every day for travelling the length and breadth of the country. The government intends to increase the speed of trains, to help attract passengers from aviation and road transport sectors.
The Modi government invited private players in the railway sector primarily because the network has been beset by decades of negligence and inefficient bureaucracy. Privatisation has set its big foot in the sector as private companies have been invited to participate in everything from modernising stations to operating trains.
Besides, the prime minister finds himself in a tight spot with limited fiscal room to support India’s burgeoning economy, which is struggling to keep itself steady.
According to a PTI report, Indian Railways will also give private operators the freedom to choose halt railway stations of the trains they operate. However, the list of such intermediate railway stations on the trains’ paths where the private operators are proposing halts, have to be submitted in advance to Indian Railways.
The in and out time at the intermediate railway stations, which shall form part of the train operation plan, will also have to be provided by the private operators, according to the report.
