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Grin and bear it, or just fly


Hike in railways' fare might tempt travellers to opt for flying
SAYAN GHOSH | Issue Dated: October 20, 2013, New Delhi
Tags : bumping fares | Indian Railways | passenger fares | |

The perennial tug-of-war between economic compulsions and social obligations is out in the open again. A weak rupee, a stagnant economy and a record current account deficit has forced the government to take a number of drastic measures, including increasing the rail fare for all classes. While passenger fares across classes have been hiked by 2%, a tariff hike in freight to the tune of 1.7% has been implemented across all commodities. The move is certain to impact the lives of millions. A majority of the poor, who are completely dependent on the railways for their travelling needs, is bound to feel cut up at being handed out this raw deal. But a hard-up government probably had no choice than to stem the railways' mounting losses by bumping fares.

The burden of the Rs.25, 000-crore loss a year can be an unbearable albatross to wear around the neck for even the mightiest of corporations. Living with such humongous losses was obviously emasculating the railways' finances, which acted as the trigger for taking this “unpopular” decision. The recent hike will go a long way in staunching the free-flowing red ink at India's largest public employer. According to official estimates, the railways will be able to add Rs.420 crore for the rest of the fiscal from the hike in passenger fares and another Rs.790 crore from the jump in freight tariff. Incidentally, this has been the second increase in passenger fares this year, taking the cost of travelling by train (for first class) within striking distance of plane fare.

The aviation industry is hoping that the recent price hike in railways' passenger fares will spur more travellers to fly. Though airline fares too have gone up in recent months, the impending launch of new airlines such as AirAsia could once again drive air fares downwards. Even otherwise the avaiation industry is ever on the lookout to ramp up its average seat load factor and is never unwilling to cut corners with expenses wherever possible. The upward pull in railway passenger prices might just offer the right inducement for train travellers to opt for flying instead.

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Issue Dated: Feb 5, 2017