Accelerated Development of Transport Infrastructure

Our inadequate transport infrastructure results in lower efficiency and productivity; higher transaction costs; and insufficient access to our large national market. How can we create an efficient and widespread multi-modal transport network.

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Should the Railways be corporatized and private participation increased? If so, how?

Re: Should the Railways be corporatized and private participation increased? If so, how?

Postby » Fri May 20, 2011 10:59 am

Maybe the Planning Commission should look into how the railway entities of European Union are structured. EU is by far the best case for India to replicate.
This would mean that the Indian Railways will have to be restructured on a State basis instead of the current Zone basis. A State level reorganization will put an end to zonal level politics and encourage States to compete amongst themselves and improve efficiency. The landed real estate of Railways (owned and to be retained by Central government) could be opened to PPP for development.
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Re: Should the Railways be corporatized and private participation increased? If so, how?

Postby » Thu May 26, 2011 7:04 pm



I am working as Deputy Chief Electrical Engineer, Railway Electrification, New Jalpaiguri and from IRSEE/98 batch. The views expressed here are my personal views as an Indian Citizen. Railway Ministry should broadly follow the model of Ministry of Power. Following are the main points of action plan for change:

1) Railway Act, 1989 should be modified to draw positive points from Electricity Act, 2003 and subordinate rules/regulations

2) All zonal railways and PU’s should be converted to PSU under Ministry of Railway. Each PSU should have strictly monitored Memorandum of Understanding on performance parameters with Ministry of Railway. Those surpassing the performance benchmarks should be enhanced financial/administrative powers. Those not performing should be either merged with adjacent good performing PSU or should be privatized.

3) RDSO should be changed on the model of CPRI. The governing council of RDSO should have representation from MoR and all subordinate PSU’s. The RDSO should have commercial relationship with PSU’s . In case of services/quality of PSU specific issues are not acceptable to PSU, they should be permitted to approach market for alternative research. For issues affecting all the PSU’s, the matter should be resolved through MoR.

4) All central project organizations should be disbanded and the work should be brought under the jurisdictional control of concerned territorial PSU. The overall targets should be fixed for each PSU by MoR based on consultation from each PSU and proposed Central Railway Authority (CRA).

5) All CTI’s/ZTI’s and RSC should be brought under single control on the model of NPTI.

6) The existing control organization should be modeled on the line of RLDC’s/NLDC (now POSOCO)

7) To encourage private participation, scheme on the line of “Open Access” in Power sector should be permitted. If spare capacity exists in the existing infrastructure, private operators should be allowed to run trains. Even for creation of infrastructure, private participation should be permitted under PPP/SPV format.

8) There should be Central Railway Authority (CRA) on the line of existing Central Electricity Authority.

9) There should be “Central Railway Regulatory Council (CRRC)” on the line of existing “CERC” model of Ministry of Railway.

10) There should be a tribunal having judicial powers for adjudication of disputes

11) Like in power sector, pure P Way Companies, pure rolling stock companies, pure train station companies should be permitted under the overall coordination of CRA on policy matters, Central control organization on train running matters, CRRC on tariff related issues and tribunal for settlement of other disputes.

12) In Human Resources aspects, lateral entry from market and IAS should be allowed from JAG level onwards with corresponding permission for Railway Officers from JAG onwards to join ex-cadre and permissible specialist/technical posts in other ministries and states.

13) The transition time for the above changes should be 5 years from the date of notification of modified Railway Act.

14) The Railway Act should be modified within 1 year from the date of notification of 12th plan.


15) Ministry of Railways should be merged with New Ministry of Transport covering sea, aviation, inland waterways, roads/surface and railways. Senior most among CRB, Secy (MoST), Secy (Ministry of Shipping) and secy (MoCA) will be the principle secretary. Existing Railway Board will become part of the new MoT. This Railway Board may become subordinate of Transportation board having member from four sectors - sea, aviation, road, railways.

16) Officers from JAG onwards should be eligible for posting in all the five sectors in ex-cadre and specialist/technical posts.

17) All gazetted Gr A posts should be made open to civil servants alternatively IRTS should be modified and renamed as "Indian Transportation Service (ITS)". This new service should be utilised to fill up all Gr A post other than Personnel, Accounts, RPF and Medical. The Engineers at Gr A level should be recruited only for RDSO at double the existing salary.

18) The present willing Gr A Engineers should be made part of ITS. The un-willing engineers may be told to leave railway or get shifted to specialist post in RDSO or other purely technical jobs in other ministry subject to vacancy

19) The Gr B Engineers on confirmation in Gr A should be given option to join RDSO or join ITS.

20) The present Technical supervisors promotional channel to Gr B service should continue as per present arrangement.


21) IRTS and IRPS service should be abolished and alternative administrative arrangements can be made from other services as explained below:

a) IRTS: The existing operating portion of IRTS can be managed by IRSSE as they are already maintaining their equipments. An entity maintaining a equipment can also operate them. The commercial portion can be managed by IRSS as they are already engaged in procurement of materials. MMIS has already been implemented in IR. PRS/UTS can also be brought under their control.

b) IRPS: Most of the HR work is done directly by the concerned executive branch. Of late it is seen that they are not taking responsibility for arranging manpower which is one of their core functions. Instead they are asking the executive branches to pursue their requirements and arrange their manpower. When IRAS can maintain their own establishment, all other services can also maintain their establishment directly. For coordination purpose, the post of Member (Staff) should continue by taking eligible officers from IRSE, IRSME, IRSEE, IRSSE, IRSS and IRAS. A small secretariat can be provided to Member (Staff) for discharging coordinating HR functions.

22) There may be view that Railway can run without involving engineers. In this regard, I would say core assets of Railway consist of P Way, Rolling Stock and Building. If these assets can be maintained without involving engineers, I have no objection.

23) IRAS should be made specialist service with minimum qualification of CA/ICWA. This will bring professionalism in the service and would lead to utilization of latest analytical/financial/accounting tools.

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Re: Should the Railways be corporatized and private participation increased? If so, how?

Postby » Thu Jul 07, 2011 1:42 pm

Railways should be unbundled into tracks,rolling stocks, network operation including signaling and regulatory authority.
the track infrastructure and rolling stock to be privatized and regulated by the regulatory authority.
Network operation including signaling to be with the government company.
Train operation to be licenced and can be auctioned
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Re: Should the Railways be corporatized and private participation increased? If so, how?

Postby » Fri Jul 08, 2011 2:50 pm

Definitely INDIAN RAILWAY is still providing cheaper transportation services to a large section of the society but now time has come to think about further improvement of services.
Actually a significant no. of people has choosen to travel through low cost airlines instead of railways due to pathetic performances of railways especially due to lack of time management. Not even a sinlgle trains be it Garib rath, Superfast or express trains runs on time for even a single day in Eastern central or Northern railway nearby New Delhi capital of nation.

Indian Railway should increase the modernization rate at least in double digits. Pathetic situations in any trains in metros or hindi states like UP, BIHAR, MP & WEST BENGAL clearly shows need of the induction of new trains & railway tracks & converting the existing double lines into 4 lines for better service which is needed from rising demands. I agree funds requirements for the same is huge which may be about 15 lakhs crores which can be funded mainly from private capitals either by issuing railway bonds or diluting the Govt. stake by 5% in initial stages and further 5% in second stages.

Railway should now think about proper time & asset management.when one single chain pulling creates a loss of 25 litre of diesel of any trains then we can understand the annual fuel losses of entite railways.

second aspect about ticket examining system. Atleast now railway should block the loopholes in existing system by adopting Centralized GPRS ENABLED TICKETING SYSTEM similar to Bangalore city transport corporation ( in ac buses) for charging fines during journey times for not having appropriate tickets or penalty.

Now railways should come up with proper fair charging mechanism. it is good for us to pay actual or higher fair from passengers travelling in sleepar or higher classes to get safer & comfortable journey.Thanks to economic growth, middle class people can now afford better services.

In short Indian Railway presently needs both partial privatisation as well as corporatisation otherwise future journey is not very easy for railways.
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Re: Should the Railways be corporatized and private participation increased? If so, how?

Postby » Wed Jul 13, 2011 7:35 am

I Strongly feel niether it should be corporatized nor privatised. In the government sector their is no personal interest involved and their is some degree of accountability towards the nation and the public. Whereas when some vested intrest of business houses will be involved then this will lead to more corpution. The only thing that will prevail will be the intrest of busnisses house and their shareholders.

NO social liabilty will be there. Glaring examples are 2G and 3G spectrum cases and common wealth games....

We should think of improving the Government machinary and its work culture. WE should fix accounabiltiy to the officials at the top level and down the line for the lapes and shortcomings.........
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Re: Should the Railways be corporatized and private particip

Postby » Wed Jul 27, 2011 11:08 am

[quote=""]Split the Railways in 2 entities 1) One will own the fixed insfrastructurei.e tracks & signalling infrastructure 2) Another will only run trains.
Once this is completed allow private companies to run trains on a non discriminatory basis on the tracks owned by the first entity.Divide the day in 10 minutes or 20 minutes slots each and allow each private operator to select the route and the time slot in which he wants to run the trains. If multiple operators want to ply on the same route on the same time slot, auction the time slot to the highest bidder. All train operators will pay a fixed fee based on the route to the corporatised entity owning tracks and other infrastructure.
This way we will have multiple trqain operators running trains at different time slots and people will have more choice in terms of fares, services offered, frequency of travel etc.

All the manufacturing units like wagon,DLW etc should be privatised.
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Re: Should the Railways be corporatized and private participation increased? If so, how?

Postby » Tue Aug 23, 2011 6:58 am

Yes, Railway shall be privatized, as currently railway is a monoply market. No one will ever favour the monopoly market.
Railways has been the bottelneck in the supply chain of agri products, coal, minerals, even passengers etc. Due to insufficient capacity and inefficiency of railway, country is at larger loss.
An act shall be passed in the parliament forming
1) independent regulator for railways
2) participation of private players in railway development
3) corporatization of railway competing with private players
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Re: Should the Railways be corporatized and private participation increased? If so, how?

Postby » Fri Aug 26, 2011 6:05 pm

Railways have primarily two kinds of delivery -- one freight movement and second passenger movement.

Their is already option for private party to own containers, container terminal management etc.

I believe the infrastructure development/ maintenance should in hand of Govt of India, through which it can control the quality of the infrastructure

I would propose a option of private party to be able to provide container service to the any customer anywhere in India connected via rails.

Privatization of cleanliness/pest control of platforms/passenger trains. I know it is done for few super fast trains. It is good and I would like to see it in all trains.

Thanks and Regards,
Aditya Deshpande
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Re: Should the Railways be corporatized and private participation increased? If so, how?

Postby » Sat Sep 10, 2011 12:49 pm

why cant indian railways be privatised if airlines in India are in private hands.
i think the fear is that ticket prices will be go out of control.

1. it is true that ticket prices will go up because private parties will be asked to provide safe operations. one accident can end in contract termination.

2. we, the nation, has to understand that railways have a capacity limitation. you just cannot keep adding trains without affecting capacity. limited capacity results in limited # of passengers.

i am in favor of indian railways in private hands. one has to develop a public private partnership model where operations can be executed by private hands while route determination can be conducted by public hands.
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Re: Should the Railways be corporatized and private participation increased? If so, how?

Postby » Sat Nov 12, 2011 5:59 pm

Private companis are greedy and will kill the railways.
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