Tuesday, July 21, 2015

Dear Comrades,

Dr.Bibek Debroy report on restructuring Indian railways will have far reaching consequences to railways and railway men.

It recommends unbundling Indian Railways.

Indian Railway Infrastructure Corporation with track, signal and stations should be formed. It should be listed in the share market and in course of time privatise through disinvestment.

Allow private entry in rail operation to compete with IR. Adhani and Ambani must be allowed to run goods and passenger trains in the existing track paying user charges to Infrastructure Company. Private operators should be allowed to fix their own market rate in order to compete.

It should shed many of its non core activities like production units, construction organisation, RPF, Railway Hospitals, Railway Schools and privatise them. Existing employees should be handed over to private.

Within four years 2.57 lakh employees are retiring from Railways, do not fill them. Stop all modes of recruitment including compassionate ground appointment, LARSGES and bungalow peons.

Settlement amount payable should be given in the form of bullet bonds for 20-30 years which means you won’t get even interest in the period and can’t even get a loan on it.

In sixth 5 year plan government investment in IR amounted 75% of total investment. Current year it is only 46%. But Govt takes away from railway revenues rupees 5 to 6 thousand crores as dividend. Govt does not meet the expense of Railways for meeting Social cost of tuning Rs 21000 crores.

IR needs an investment of Rs 5 lakh crore to complete its ongoing projects of New lines, gauge conversion, doubling ,electrification etc .It needs an investment of Rs 81450 crore to complete Eastern and Western dedicated freight corridors. For Coach and Engine factories it needs 1 lakh crore rupees. As per the recommendation of Dr. ANIL KAKODKAR (HLSRC) ON RAILWAYT SAFETY, An Investment OF Rs 1 lakh crore is needed. As per SAM PITRODA committee report an investment of Rs 5.69 lakh crore is needed for modernization. The planning commission estimated that railway needs an investment of Rs 35 lakh crore for 20 years from2012 to 2032.Earlier Kumari Mamata Banerjee in her vision 2020 in 2009 had forecast an investment need of Rs 14 lakh crore in 10 years.

All these recommendations are only in paper.

What Debroy tells us:

According to Bibek Debroy,”yes, private has not responded, even after 7 years of opening. FDI did not come for erecting engine factories either at Madhepura or Marohra. But they will not come in the present scenario. They will come only after the restructuring we have proposed are implemented”.

“The government is rightfully optimistic about bringing foreign direct investment into the railway sector, as the benefits are significant: the induction of cutting edge technology and international management practices that can dramatically help to modernize IR.

However, foreign investment will not come under the present scenario. It will come only if the railway sector is reformed along the lines discussed in this Report and the change in incentives and structure as proposed in this Report are put in place. The railway sector will then become worthy of foreign investment in ancillary production units, terminals, signaling, logistics and the operation of trains”


Argentina railway was privatised when it had 47000 route Kilo meters and 95000 employees. After privatisation many railway lines were closed as loss making and now there remains only 8000 km and 15000 employees. Even in 8000 km rail is operated with huge subsidy from the government. Now left government of Argentina has decided to re nationalise railways.

In Briton the autonomous State-owned Corporation, Rail track plc, set up in 1993 to manage infrastructure, collapsed in 2001 under the weight of high expenditure and poor recoveries from private train operators. Its successor, Network Rail, saw its debt burden rise from about £9,600 million in 2002-03 to about £30,000 million in 2012, with interest payments exceeding track maintenance expenses. Track access charges were continually lowered upon demands by the private operators, further reducing incomes. Following EU principles, the entire debt burden was later transferred to the State budget. Today UK taxpayers bear double the burden they did before privatisation!

2363 stations and 266 routes have been closed as unprofitable. On average, British fares are 30 percent higher than in continental Europe where many rail services such as in France and Germany are run by State-owned corporations which, incidentally, also operate more than half the rail services in the UK. Ironically, the only State-run rail service left in the UK, East Coast Rail, is among the most profitable, and the Conservative government is hell bent on privatising it. Now a referendum in Britain has favoured (68%) re- nationalisation of RAIL OPERATIONS also.

What is the Stand our Recognised Ferderations?

AIRF organized protest on 30th June, NFIR on 25 June. AIRF to arrange unity of all railway unions at all levels so that workers get confidence in struggle and Govt gets a message that all are united so we must listen to them. If we are divided we fall. But Unfortunately AIRF chose to individual protest, it means that they are not serious to stop the implementation of the report.

Nairuthya Railway Employees Union (NREU) requests all the Railway Employees to realize the threat against our existence and fight vigorously.



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