12 September 2016

Flexi fare to be applicable to only some Premium Trains

Ministry of Railways has introduced flexi fare system for Rajdhani, Duronto and Shatabdi trains.The purpose of the scheme is to recover partial cost of operations and reduce the element of subsidy from those who have the ability to pay.The flexi fare scheme has been introduced only on some of the trains which constitute 1% of the total trains and 4.4% of the total Mail/Express trains.The proposed scheme would only impact 0.65% of the total passengers, 99% of the trains which carry 99.36% of the passengers are not impacted by this scheme. The main points regarding revision of fares are:

·Expenditureon Passenger Amenities in last Three years:
1.2014-15 – 858 Cr ,2015-16 – 1212 Cr ,2016-17- 1838 Cr
·Indian Railways has planned substantial improvements in capacity and improvement in quality of services.Infusion of capital to the tune of Rs 8.56 lakh Cr has already been tied up for the Indian Railways in 2015-19 of which Rs 2 lakh cr will be used in network decongestion, Rs 1 lakh Cr in station development and logistic parks ,Rs1 lakh cr in rolling stock, Rs 1.27 Lakh Cr in Safety, 0.65 Lakh Cr in High Speed and so on. The Plan Expenditure has already been increased from 57,000 Crore in 2014-15 to 94,000 Crore in 2015-16 and is budgeted for 1.21 lakh cr in 2016-17.
·Station Development: 404 A and A1 category stations planned for redevelopment of stations on PPP basis

New Train Products Planned: (announced in Budget 2016)
1.Tejas Express – Upgrading Intercity travel in India – Trains with speed of 130 kmph and above, onboardservices such as entertainment, local cuisine,Wi Fi etc.through one service provider.
Humsafar Express – An upgraded fully Air- Conditioned3rd AC service with an optional servicesfor meals
Antyodaya Express – A long distance fully unreserved superfast train service for common passengers to be operated on busy routes.
Utkrisht Double Decker Air Conditioned Yatri (UDAY) Express – An overnight double-decker servicewith potential to increase carrying capacity substantially.
Deen Dayalu Coaches: with facility for potable drinking water and a higher number of mobile charging points-

Other Major Initiatives for the common man: Next Generation E-ticketing System (NGeT) System capacity enhanced from 2000 tickets/minute to 15000 tickets/minute, Paperless UTS Tickets on Smart Phones introduced in Suburban sections, Cash Operated Ticket Vending Machines commissioned at 246 stations, Paperless Platform tickets at major stations and Paperless Season Tickets on smart phone, Hand Held Terminals for unreserved tickets at Points of Salelaunched at Hazrat Nizamuddin Railway Station, Swachh Bharat Swachh Rail Mission,All A1 class stations to be manned with duly empowered Station Directors,Wi-Fi service provided at select stations. Indian Railwayswill commissionWi-Fi services at 100 stations this year and at 400 more stations in the next 2 years,On board entertainment system in trains introduced on Gatimaan Express, Engaging with passengers- connecting and responding on-line. Twitter: More than 7000 tweets received per day , VIKALP system for alternate train accommodation.

·Theflexi- fare system introduced on Rajdhani Shatabdi and duronto trains is on an experimental basis.
1.142 (mainly high end) trains out of about 12500 total trains and 3200 Mail Express trains run by IR will be chosen for this experiment ie only 1.1% of total trains and 4.4% of Mail/Express trains.
2.This will affect less than 0.15 million (mainly high end passengers) out of total 23 million passengers carried by IR daily. This number is about 0.65% of the total passengers carried and about 10% of the reserved passengers carried by IR.
3.Lower end Common man is not affected by this experiment
·International Experience: Most Railways as also other service providers follow dynamic pricing. This includes airlines, hotels, car rentals, retailers especially e-commerce, etc.Railways like Russian railways, European railways like UK, French etc,American railways, Japanese Railways etc all have been following dynamic pricing since long.

·The passenger services of IR are highly subsidized. While the cost per Passenger Kilometre on IR was 73 paise, IR recovered only 37 paise.In contrast IR recovers Rs 1.55 on each freight NTKM as against a cost of 99 paise per NTKM. As a result of this subsidization of passenger services , the Indian Railways bore a loss of 33490 Cr on coaching services. IR has been displaying theinformation on its tickets- PRS and UTS tickets ( Indian Railways recovers only 56% of the cost of travel). The recovery from this measure would only be to the extent of Rs 400 cr in the current year.

·Othermeasures- Cost cutting and Additional revenue Mobilisation
1.Cost cutting : 9000 crores saved last year.
2.Non Fare Revenue directorate formed
3.Target for sundry earning increased from Rs 6229 Cr( RE 2015-16) to 9590Cr( BE 2016-17). Major increase in Advertising revenue through Non Fare directorate.
4.Target of Other Coaching earning increased from 4325 Cr ( RE 2015-16) to Rs 6185 Cr. Major increase in parecel earnings.
·7th Pay commission liability of about 29000 crore

Ministry of Railways has introduced flexi fare system for Rajdhani, Duronto and Shatabdi trains.The purpose of the scheme is to recover partial cost of operations and reduce the element of subsidy from those who have the ability to pay.The flexi fare scheme has been introduced only on some of the trains which constitute 1% of the total trains and 4.4% of the total Mail/Express trains.The proposed scheme would only impact 0.65% of the total passengers, 99% of the trains which carry 99.36% of the passengers are not impacted by this scheme. The main points regarding revision of fares are:

·Expenditureon Passenger Amenities in last Three years:
1.2014-15 – 858 Cr ,2015-16 – 1212 Cr ,2016-17- 1838 Cr
·Indian Railways has planned substantial improvements in capacity and improvement in quality of services.Infusion of capital to the tune of Rs 8.56 lakh Cr has already been tied up for the Indian Railways in 2015-19 of which Rs 2 lakh cr will be used in network decongestion, Rs 1 lakh Cr in station development and logistic parks ,Rs1 lakh cr in rolling stock, Rs 1.27 Lakh Cr in Safety, 0.65 Lakh Cr in High Speed and so on. The Plan Expenditure has already been increased from 57,000 Crore in 2014-15 to 94,000 Crore in 2015-16 and is budgeted for 1.21 lakh cr in 2016-17.
·Station Development: 404 A and A1 category stations planned for redevelopment of stations on PPP basis

New Train Products Planned: (announced in Budget 2016)
1.Tejas Express – Upgrading Intercity travel in India – Trains with speed of 130 kmph and above, onboardservices such as entertainment, local cuisine,Wi Fi etc.through one service provider.
Humsafar Express – An upgraded fully Air- Conditioned3rd AC service with an optional servicesfor meals
Antyodaya Express – A long distance fully unreserved superfast train service for common passengers to be operated on busy routes.
Utkrisht Double Decker Air Conditioned Yatri (UDAY) Express – An overnight double-decker servicewith potential to increase carrying capacity substantially.
Deen Dayalu Coaches: with facility for potable drinking water and a higher number of mobile charging points-

Other Major Initiatives for the common man: Next Generation E-ticketing System (NGeT) System capacity enhanced from 2000 tickets/minute to 15000 tickets/minute, Paperless UTS Tickets on Smart Phones introduced in Suburban sections, Cash Operated Ticket Vending Machines commissioned at 246 stations, Paperless Platform tickets at major stations and Paperless Season Tickets on smart phone, Hand Held Terminals for unreserved tickets at Points of Salelaunched at Hazrat Nizamuddin Railway Station, Swachh Bharat Swachh Rail Mission,All A1 class stations to be manned with duly empowered Station Directors,Wi-Fi service provided at select stations. Indian Railwayswill commissionWi-Fi services at 100 stations this year and at 400 more stations in the next 2 years,On board entertainment system in trains introduced on Gatimaan Express, Engaging with passengers- connecting and responding on-line. Twitter: More than 7000 tweets received per day , VIKALP system for alternate train accommodation.

·Theflexi- fare system introduced on Rajdhani Shatabdi and duronto trains is on an experimental basis.
1.142 (mainly high end) trains out of about 12500 total trains and 3200 Mail Express trains run by IR will be chosen for this experiment ie only 1.1% of total trains and 4.4% of Mail/Express trains.
2.This will affect less than 0.15 million (mainly high end passengers) out of total 23 million passengers carried by IR daily. This number is about 0.65% of the total passengers carried and about 10% of the reserved passengers carried by IR.
3.Lower end Common man is not affected by this experiment
·International Experience: Most Railways as also other service providers follow dynamic pricing. This includes airlines, hotels, car rentals, retailers especially e-commerce, etc.Railways like Russian railways, European railways like UK, French etc,American railways, Japanese Railways etc all have been following dynamic pricing since long.

·The passenger services of IR are highly subsidized. While the cost per Passenger Kilometre on IR was 73 paise, IR recovered only 37 paise.In contrast IR recovers Rs 1.55 on each freight NTKM as against a cost of 99 paise per NTKM. As a result of this subsidization of passenger services , the Indian Railways bore a loss of 33490 Cr on coaching services. IR has been displaying theinformation on its tickets- PRS and UTS tickets ( Indian Railways recovers only 56% of the cost of travel). The recovery from this measure would only be to the extent of Rs 400 cr in the current year.

·Othermeasures- Cost cutting and Additional revenue Mobilisation
1.Cost cutting : 9000 crores saved last year.
2.Non Fare Revenue directorate formed
3.Target for sundry earning increased from Rs 6229 Cr( RE 2015-16) to 9590Cr( BE 2016-17). Major increase in Advertising revenue through Non Fare directorate.
4.Target of Other Coaching earning increased from 4325 Cr ( RE 2015-16) to Rs 6185 Cr. Major increase in parecel earnings.
·7th Pay commission liability of about 29000 crore

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