Thursday, July 3, 2014

Railways waiting for Modi 'magic'

Prime Minister Narendra ModiPHOTO:PTI
Prime Minister Narendra ModiPHOTO:PTI
India's new government will next week roll out plans to overhaul its sprawling rail network, dubbed the "lifeline of the nation", which analysts say needs hundreds of billions of dollars of investment.
Two days before Prime Minister Narendra Modi's new administration presents its first budget, a separate rail finance bill will be presented to parliament on Tuesday following a controversial recent fares hike.
The country's railway system is one of the biggest in the world, stretching from the foothills of the Himalayas to the southern beaches.
But observers say it has been neglected by successive governments over the past three decades of rapid economic growth during which car ownership has surged and low-cost airlines have mushroomed.
"I'm very glad the government is addressing the chronic logistics problem," said Arvind Mahajan, an infrastructure specialist at KPMG. "It has a lot of work to cover."
Railways is still the main form of long-distance travel for most of India's 1.2 billion population.
But some services are booked up for weeks in advance and overcrowding - especially in lower-class carriages which lack air-conditioning - means rail travel is often a miserable experience.
The network has a dreadful safety record with a government report in 2012 putting the number of deaths each year at nearly 15,000.
Many are killed falling off overcrowded trains or crossing the tracks.
Others are charred to death while perched on coach roofs as high-voltage electricity courses through overhead wires.
As for freight, endemic delays make it sometimes impossible for businesses to predict when their goods will arrive.
Under the previous United Progressive Alliance-II government, the main governing Congress party was happy to leave the railways ministry in the hands of a junior partner which showed little inclination to push reforms.
The government hiked passenger fares 14.2 percent and freight rates 6.5 percent -- the steepest rise in 15 years.
Although there was a subsequent partial climbdown, Finance Minister Arun Jaitley said India "must decide whether it wants a world-class railway or a ramshackled one".
One of the big questions will be if Prime Minister Narendra Modi can develop a high-speed rail network, with China having offered its expertise.AFP


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