Railway Budget 2016: Did Assembly polls stop Suresh Prabhu from hiking passenger fares?

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Bengaluru, Feb 25: Railway Minister Suresh Prabhu on Thursday presented his second railway budget and it did not increase the passenger fare and instead announced some people-friendly steps, including introduction of three superfast trains.

[Railway Budget 2016: Highlights

Given the railways's financial health, the question which is being raised is: How can the sector increase its income if there is no hike in the passenges' fare?

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Railway officials believe the income can be made up through other means, like collaborating with the states in developing projects, advertisements and commercial use of railways's areas. But they may not be enough still to ensure a turnaround for the railways.

The officials have also tried to defend the decision of not raising the passenger fare by saying that the actual income of the railways comes from freight and since the market of crude iron, cement and steel has been hit by a slowdown, the railways's freight income has also faced an impact.

Two reasons for not raising the passenger fare

But the actual reason for not increasing the passenger fares could be something else.

First, four states and a Union Territory are going to elections this year and the BJP is not in government in any of them. The NDA government is thus cautious about not raising the passenger fares ahead of those polls.

Secondly, the number of passengers iin railways has gone down alarmingly in last few years. The officials have struggled to find out the reason. In this situation, increasing the fares might prove to be counter-productive.

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