Govt hikes Rail passenger fare by 14.2 per cent

In its first unpopulist decision, the Modi government announced today 14.2 percent hike in railway passenger fare in all classes and 6.5 percent hike in freight. The new fare will be effected from June 25.

Railway minister Sadananda Gowda got the green signal from PM Natendra Modi to go ahead with the hike as it was essential and much needed.

Railway Minister Sadananda Gowda said he had only taken forward what former Railway Minister Mallikarjun Kharge decided.

“10% increase in passenger fare and 5% increase in freight was made in the interim budget but the previous government withheld it,” he said.

Former Railway Minister Mallikarjun Kharge put it on hold and left the decision to the new government.

“It is now informed that under the directions of the Minister of Railways Mallikarjun Kharge, the decision on the proposed hike in the freight charges and passenger fares have been kept pended till further advice for placing this proposal before the new government,” the railway statement had said last month.

Indian Railways is badly needed modernisation and attention from government. At present Railways is facing a severe financial deficit with passenger subsidy touching Rs. 26,000 crore. The government had no choice but to take fiscally correct measures. Although the railway transports estimated over 25 million passengers per day, but it had not increased fare for the last 10 years.

As expected opposition parties protest against the fare hike, but corporate world has welcomed the decision.

RJD leader Lalu Prasad Yadav demanded rollback.

“Acche din. Acche din. The BJP has fired its first salvo at the poor people of this country. Whenever the BJP comes to power, they try and get a few people all the advantage,” Yadav said.

Adi Godrej, Chairman of Godrej group, has welcomed the decision.

“The railway fare hike is a good move, and we can now expect the railway budget to deal with operational issues and privatization,” said Adi Godrej.

“Railways have been severely constrained on funds for priority areas like safety and security besides improving the service. They also need cash for upgrading the signalling system and tracks. Long pending railway projects like freight corridors may also now take off, if funds become available,” Harsh Goenka, Chairman, RPG Enterprises said.

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