Rail Budget: Freight unchanged, passenger fares cut
New Delhi: Looming inflationary pressures led the union railway minister, Lalu Prasad to cut freight rates and passenger fares.

The 2007-08 railway budget has effected token reductions in passenger fares by up to eight per cent and freight charges on petro-products, iron ore, limestone and other minerals by 5-6 per cent.

The Rail Budget has left fares unchanged on the existing AC 3-tier and Sleeper coaches that have 64 and 72 berths respectively.

For passengers travelling in new-generation coaches with 81 (AC 3-tier) and 84 (sleeper) berths, there would be a four per cent reduction. The discount is eight per cent for the 81-berth AC 3-tier and 102-seat AC chair cars in the lean season (January-April and July-September).

However, the catch in all this is that the higher capacity coaches would be rolled out only from the next fiscal and since their induction would take time, it means most of the running trains will not be covered by the discounted fares.

There have also been similar cosmetic reductions of Rs1-2 for non-AC second-class passengers. On the freight front, the Rail Minister has proposed a five per cent lowering of the tariff on diesel, petrol and ammonia and six per cent in the case of iron ore, limestone, dolomite and other minerals used by cement and steel manufacturers. These are again unlikely to translate into cheaper petrol or steel for consumers.

To sum it up Lalu Prasad's proposals on both passenger and goods front are more `non-inflationary' than `anti-inflationary'.

Prasad has also announced 32 new trains, eight new low-cost air-conditioned trains or Garib Raths, extension of 23 trains and increase in frequency for 14 trains. The railways operates over 9,000 trains every day.
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Rail finances on the upswing
During the current fiscal, the Railways' gross traffic receipts are expected to touch Rs63,220 crore, as against the originally budgeted Rs59,978 crore. After deducting various operating expenses (fuel, salaries, lease charges, etc), besides pension and miscellaneous expenditure, there would be a cash surplus of Rs20,063.11 crore, up from Rs14,709.79 crore in 2005-06.

The Railways has projected gross traffic receipts at Rs71,318 crore for the coming fiscal (a Rs8,098 crore jump over the revised estimate for 2006-07).

While passenger revenues are slated to grow by Rs2,675 crore to Rs20,075 crore, those from freight would go up by Rs4,644 crore to Rs46,943 crore.

Freight is expected deliver an extra 59 million tonnes (mt) loading - almost the same as the increase in total freight tonnage from 666.5 mt in 2005-06 to 726 mt this fiscal.

The Railways are expected to register a cash surplus of Rs21,578.45 crore during 2007-08. After giving a dividend of Rs4,572.54 crore to the Centre - against Rs4,242.26 crore this fiscal - there would still be well over Rs17,000 crore of internal resources to fund a proposed investment plan of Rs31,000 crore.

Other financing sources would include Rs5,000 crore of borrowings through the Indian Railways Finance Corporation, Rs500 crore under the Wagon Investment Scheme and 240 crore to be raised by the Rail Vikas Nigam Ltd.

The Railways' `operating ratio' - a broad efficiency indicator of amount spent for earning every rupee - is budgeted to be 79.6 per cent in 2007-08, against this year's 78.7 per cent. This ratio had crossed 98 per cent in 2000-01.
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Consumer confidence sweeps India: Nielsen
Mumbai: A wave of consumer confidence continues to sweep India, which led a 46-country Consumer Confidence Index, scoring an all-time-high Index of 137, according to A C Nielsen, the world's leading market research and information company.

Achieving the second and third place in the 46 country index are the Norwegians (134) and the Danes (129).

Indians are feeling exceedingly bullish about the job market with 95 pc rating it as excellent or good, as well as the state of their personal finances in the next year with 87 per cent. The increasing terrorist attack has made terrorism (30 per cent) as one of the largest concern area, the survey said.
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