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Speech Part II


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Budget 1998-99
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Speech of Shri Nitish Kumar
Introducing the Railway Budget, 1999-2000
on 25th February 1999 - Part II

Budget Estimates 1999-2000

Sir, I shall now deal with the Budget Estimates for 1999-2000.

I think there are reasons to believe that the growth of the economy, which has been below our expectations in the current year, will accelerate next year. Relying upon that assumption, the freight traffic projection for 1999-2000 has been made at the level of 450 million tonnes. As regards passenger traffic, I expect a somewhat faster growth than in previous years. This forecast is based on the proposed augmentation of load of popular trains and other improvements in the pattern of train services. A growth of 8.5% over the current year is being taken. Other Coaching and Sundry Other earnings are expected to increase by 5% over the current year. On this basis, Gross Traffic Receipts are estimated at Rs. 32,411 cr including realisation of Rs. 200 cr of outstanding dues.
Ordinary Working Expenses of the Railways have been estimated at Rs. 25,740 cr which is higher than the Revised Estimates of the current year, of Rs. 23,375 cr, by 10.1%. This increase of Rs. 2,365 cr provides for higher levels of expenditure on materials and contractual payments required for maintenance purposes with due regard to safety. Expenditure on Security has also been enhanced. The estimates also provide for normal increases such as for staff increments, dearness allowance, lease charges on account of market borrowings, fuel etc.
The pensionary liability in 1999-2000 is estimated at Rs. 3,300 cr. It has reached a higher level after the year 1996-97 consequent upon liberalisation of benefits to more than ten lakh Railway pensioners following the recommendations of the Fifth Central Pay Commission. Appropriation to the Pension Fund from Revenue is proposed to be made to the extent of Rs. 2,954 cr as compared to Rs. 3,425 cr in Revised Estimates of 1998-99. It is also necessary to withdraw an amount of Rs. 200 cr from the balance in the Fund.
The Appropriation to the Depreciation Reserve Fund from Revenue is proposed to be made to the extent of Rs. 1,589 cr as compared to Rs. 1,600 cr in the current year's Revised Estimates. In this case also a drawdown from the Fund balance is required, to the extent of Rs. 600 cr.
The Total Working Expenses will thus amount to Rs. 30,283 cr, leading to Net Traffic Receipts of Rs.2,128 cr. Net Miscellaneous Receipts are estimated at Rs. 430 cr and thus a Net Revenue of Rs. 2,558 cr is reached. Payment of dividend to the General Revenues has been computed at Rs. 1,914 cr as compared to Rs. 1,752 cr in the Revised Estimate of the current year based upon recommendations of the Railway Convention Committee (1996) in their Report relating to the year 1997-98. Necessary adjustment, if any required, will be made on receipt of the recommendations of the Railway Convention Committee (1998) to whom an interim memorandum is being submitted in respect of the year 1999-2000. The 'Excess' in the financial results works out only to Rs. 644 cr which falls very much short of the segments of Plan expenditure to be met from the Development Fund and the Capital Fund together totalling Rs.1765 cr.
There is thus an additional requirement of Rs. 1,121 cr for financing the works chargeable to these two Funds. A part of this requirement is proposed to be met by drawdown from the balance in the Capital Fund to the extent of Rs. 200 cr and the interest on the Fund amounting to Rs.21 cr. Thus an amount of Rs. 900 cr is to be mobilised additionally.
There was generally no increase in the freight rates in the last Railway Budget. But the cost of operations is increasing and they have to be met. Keeping this in view, I propose to make a minor increase of 4% uniformly on the freight rates of all commodities. The increase is less than the general inflation in prices. Minor adjustments in the classification for charge are also proposed to be made for Washed Coal and Caustic Soda Liquor. The increase in each case is by one step only.
I have been receiving representations from the trade to reduce the burden of idle freight on short lead traffic, which is charged for minimum 100 km. I have, therefore, decided to allow a concession of 25% in the freight rate for traffic hauled for distances up to 50 km.
Sir, there is a growing demand for improvement in passenger services. As I mentioned earlier in my speech, Railways have brought about improvements in the current year and have plans for strengthening it still further. The results have been gratifying and our esteemed customers have responded by providing buoyancy in passenger revenue. In deference to this, we have decided to give a respite to a bulk of rail passengers. In this "Passenger Year", as a special gift to about 90 % of the passengers, who travel by second class, no increase is being effected in Second Class fares, both of Mail/Express and ordinary trains. Second Class Season ticket fare will also remain unchanged. While in the "Passenger Year" we are giving better facilities to the bonafide passengers, we shall intensify our campaign against ticketless travel.
Those who take the Sleeper Class and the upper classes, however, are provided with much higher level of comfort and I think it would be reasonable to expect them to pay a little more for their journeys. I propose to introduce a rationalisation that takes into account the difference in the levels of comfort as between sleeping accommodation and sitting accommodation, as also the superior comfort of travel in air-conditioned classes. Thus keeping the fares of Second class Mail/Express as the base, the fares of other classes on Mail/Express trains are proposed to be rationalised as :-
Sleeper Class - 1.55 times;
AC Chair Car - 3 times;
AC 3-tier Sleeper - 4.5 times;
First Class - 5.25 times;
AC-2 tier Sleeper - 7.2 times; and
AC First Class - 14.4 times.
Likewise, in the ordinary passenger trains, the fares for Sleeper Class and First Class will be respectively 1.55 times and 5.25 times of the Second Class (Ordinary) fare.
However, the existing fares of higher classes happen to be more than the fares that would be determined by this approach in some distance ranges. These are not being changed.
The fares of Rajdhani/Shatabdi Express trains are also proposed to be revised by making suitable adjustments in the existing fare structure.
The minimum distance for charge for travel in upper classes of mail and express trains is proposed to be revised to a uniform figure of 100 km for all the upper classes.
The minimum distance for charge in the Sleeper Class, which is 200 km, will not hereafter apply to travel in certain sections where Railways have declared sleeper coaches to be unreserved on certain trains; normal Sleeper Class fares only will be levied in such cases.
As in the case of freight rates, an increase of 4% is proposed to be applied on all parcel and luggage scales.
These proposals will come into effect from 1.4.1999. They are expected to yield an additional revenue of Rs. 900 cr during the full year. This is made up of Rs. 700 cr from freight traffic and Rs. 200 cr from Coaching Traffic which includes Passengers, Parcel and Luggage.
The year 1998-99 has been a year of struggle in respect of operating and financial performance. However, that has not discouraged us and we have continued to contribute to the industrial and economic development of the nation. We have been able to achieve this with the guidance of the Hon'ble Prime Minister. He has encouraged us during moments of difficulty and has provided constructive help. The entire railway family is obliged to him for his constructive help.
I would like to thank all the railwaymen for their hard work and dedication to duty which has helped railways in achieving their task successfully. Our thanks are due to passengers and users of the railways whose cooperation we have always been getting and I am confident that this cooperation will be forthcoming in future too.

Sir, with these words I commend the Railway Budget 1999-2000 to the House.

 

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