Railways: is surge pricing designed to clear the path to privatisation?

Some analysts argue these steps are being taken to favour private airlines that offer more competitive prices on trunk routes. While this could be true for the short-term, as long as oil prices remain low - and, thereby, make it affordable for the airlines to fly at lower cost - there could be more to it than meets the eye.

The largest railway network in the world with over 115,000 kms of track, carrying 23 million passengers every day - or about 8.4 billion every year, amounting to a passenger movement equivalent to eight times the population of this country - to and from over 7,000 destinations should be an attractive proposition for any business.

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What has prevented privatisation of the railways thus far has been its non-viability, as the bulk of its 12-13 million long-distance passengers are ordinary people who pay under Rs 400 for an overnight, non-AC but comfortable sleeper berth. The railways, according to the IRCTC, recovers only 57% of its cost from normal passenger fares. While this made it unviable for privatisation, the affordability gave the railways the edge and its iconic role in national integration - taking ordinary people far and wide at affordable prices.

In fact, the railways is the only mode of transport where one could even manage ticketless travel - a choice that helped millions of people survive through distress migration to cities in other parts of the country.

However, the slew of steps that the present regime has taken is changing the conditions that made privatisation of railways unviable. As was done in the earlier tranches of privatisation, of sections of railway services like catering, supply of bed rolls, etc., next on offer could be trains that have been spruced up for killer profits. They are ready and waiting for a private owner.

All that remains is handing over of keys to these 'special' trains to private companies. This isn't much different from handing over oil rigs to private players after taxpayer money has been spent on finding oil. And mind you, it is only these cash cows that will be handed over and not the entire railways, as that will be an unwieldy proposition.

If you know the traffic control system of the Indian Railways, the practice has been that the more important trains always gets precedence over other trains (superfast trains over express, express trains over passenger rails). So, we could now be staring at days when all trains will wait for private trains to pass by on tracks built and maintained by taxpayer money.

Acche Din indeed!

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