NEW DELHI: Pawan Bansal's induction in the railway ministry last year was ascribed to Prime Minister Manmohan Singh. Fed up with hemorrhaging of railway finances under successive regional chieftains who lorded over the crucial infrastructure ministry, the PM was keen on bringing in someone more in league with his own reformist instincts.
Tuesday's rail budget, marked by a focus on restoring fiscal discipline after years of runaway profligacy, shows that Bansal has lived up to expectations. Although understated, some proposals are so significant that the discerning can be excused if they think these were written by the PM himself.
It signals the Congress leadership's acquiescence to the harsh economic reality which has cramped the room for sops, to the extent that the PM and the finance minister today are on the same page. It provides a foretaste of what could be in store on Thursday when P Chidambaram presents his budget.
The austere presentation contrasts sharply with the populist grandstanding under Bansal's predecessors, Mamata Banerjee and Lalu Prasad, focusing more on consolidation. Bansal said right at the outset that the public transporter was unable to improve users' amenities, safety and efficiency because his predecessors were not concerned about financial sustainability. There is a reference to social responsibility but only as part of the larger argument to ensure the organization's financial stability.
Barring projects conceived from the point of view of national security, Bansal forthrightly said that funding would be available only to those projects that will be commercially viable. Put simply, it puts a question mark on the fate of schemes launched for political reasons and were justified on the ground of social obligations. "The thin spread of scarce resources can be overcome only in this manner,'' the minister said.
He refrained from hiking passenger fares but that did not take away from the budget's reformist thrust. Having raised fares only recently, Bansal had headroom to showcase his concern for commuters. But, he proposed to mop up a considerable amount increasing charges on services. More importantly, he made a pitch for an annual increase of 5-6% in fares. Read along with the bold advocacy to align fares with fuel prices, this is a far cry from the days when asking passengers to pay more was an anathema.
While the inspiration may have come from the PM, Bansal was helped by the fact that he, being the representative of the Union Territory of Chandigarh, was not handicapped by the need to cater to a large constituency. As a result, while there were expected protests against non-fulfillment of demands, there was no jealousy towards the region that Bihar and Bengal evoked under Lalu and Mamata.
Bansal stressed that the railways will close the current fiscal with a surplus, and that operating ratio is expected to improve to 87.88%. The proposals seemed designed to help achieve the objective to restore financial viability of railways and, if implemented, can mark an important step towards the paradigm shift that the budget talks about.
Budget 2013 > Rail Budget 2013 > Economic Survey 2013
Rail Budget 2013: Coach PM gets Bansal to keep it on track
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Rail Budget 2013: Coach PM gets Bansal to keep it on track
