'Railways manages operating ratio of 94 per cent despite pay hike, flat growth’

'Railways manages operating ratio of 94 per cent despite pay hike, flat growth’ET Bureau | Jan 3, 2017, 

Railways faces an additional burden of Rs 32,000 crore because of the seventh pay commission award.

NEW DELHI: Indian Railways is expected to have an operating ratio of 94% for the current financial year despite the huge liability of seventh pay commission and negligible growth in the freight loading, railway minister Suresh Prabhuhas said.

Operating ratio shows how much of revenue goes into meeting expense. Lower the ratio better it is for the railways.

“We have got a huge liability in the form of seventh pay commission award. The growth in coal and steel loading has been flat. Keeping all this mind, I think we have done a decent job by controlling the operating ratio at 94,” Prabhu said at a function on Monday.

Railways faces an additional burden of Rs 32,000 crore because of the seventh pay commission award.

In the budget, the railway minister had targeted an operating ratio of 92%. Prabhu said savings from diesel and electricity bill will let the national transporter offset the impact of flat growth.

On possible fare hike, he said railways has already implemented the flexi fare system on premium trains and there was a need for periodic review of railway fares.

Talking about train derailment cases, Prabhu said his ministry plans to set up a dedicated rail safety fund and the finance ministry has given in-principle approval for railway safety. So, more money will be spend on safety in the next budget, he said.