Railways seeks to boost internal revenue in post-pandemic push
Indian Railways’ internal revenue generation has been hit over the years
Having failed to increase internal revenue generation in the last three years, Indian Railways proposes a mega-push to raise its fare and non-fare revenues in FY24 based on first assessment of earnings in largely covid-free FY23.
According to two people privy to the development, the national transporter proposes to set a high target of ₹10,000 crore through internal generation in FY24.
In doing so it is pinning its hopes on a second covid-free year boosting passenger and freight earnings.
Alongside, a monetisation exercise involving commercial use of its airspace and vacant land is expected to raise its non-fare revenue.
Indian Railways’ internal revenue generation has been hit over the years, bringing down actual realisations against the budgeted levels.
Railways’ capacity to generate internal resources was hampered in 2016-17 and 2017-18 due to a sharp increase in staff costs and pension expenditure following the implementation 7th Central Pay Commission without commensurate growth in traffic revenue.
With stabilization of working expenses and picking up of railway revenue, the year 2018-19 saw some improvement in internal resource generation.
But the covid-19 pandemic led to less-than-projected revenue generation.
Railways’ capacity to generate internal resources was severely hampered in 2019-20, 2020-21 and 2021-22.
In FY20, the actual generation of internal resources of the Railways was only ₹1,685.09 crore, 33% of the revised estimate of ₹5000 crore.
Similarly, in 2021-22, the actual realisation remained ₹1,422.95 crore against the RE of ₹2,500 crore.