The Madras Chamber observes that there were not much of figures in the main presentation of the budget ,but the devil or divine could be in the details. “While the non increase in passenger fares is on expected lines, no big ‘ticket’ items like no new trains or other major plans have come as a surprise.”

Welcome Moves:

• The focus on cleanliness ,safety, passenger amenities and transparency and governance.
• Proposed Improvement in operating efficiency and ratios, though a major portion of that could be the result of falling fuel prices.
• Simplifying the wagon leasing scheme.
• Setting up the Logistics Corporation  of India
• For the first time expansion of freight handling through  integration with port and air cargo  from ICD is spoken about  and also  a 2000 cr coastal connectivity program.
• Plan to Set up of Infras fund with JV
• Setting up of an independent regulatory board on performance benchmarks and tariffs is a welcome move.

Points to Ponder

• Under investment should end no doubt , but the ambitious plan of raising around 48 % of the total outlay through other sources :  how this would be done is a point to ponder.
• How the debt will be serviced is also to be watched and understood.
• Cross subsidizing the passenger fares by freight cost continues to be a matter of concern for the Chamber.
• While the budget is a passenger friendly budget, the cost push effect of freight increase in basic commodities like iron & steel, cement and coal could have an inflationary effect.
• Increase in Urea freight will swell the subsidy kitty and  affect the cash flow of the fertilizer companies.
• The Minister speaks about States’ investment in Railways. The question remains whether the States will come forward, given their limited resources and other priorities.

“ No doubt ,the Railways have to go through a transformation, and this budget could be one step in that direction. But a lot needs to be done and more concerted efforts and clear action plans on fund raising and timelines are required” says Mr J Krishnan, Chairman, Logistics Committee & Member, General Committee of the Chamber.
September 2019
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