Railways hiked fares up to 4 paisa/km, it will compensate barely 5% of Rs 55000 Cr losses: Goyal

Indian Railways has made a "miniscule" hike in fares of up to 4 paisa per km that will barely compensate 5 per cent of the Rs 55,000-crore losses incurred during the year, Railways Minister Piyush Goyal said in Rajya Sabha on Friday. Railways hiked passenger fares with effect from January 1 this year. 

"As against Rs 8,000 crore which was the loss on passenger services in 2004, in the current period we are losing about Rs 55,000 crore on passenger services provided throughout the country. However, passenger fare increase is a very sensitive subject.... A very nominal increase was done," Goyal said replying to a query during Question Hour.

He said while there is no increase in fares in suburban services. In case of non-suburban services, a nominal increase of one paisa per km has been done and in case of non-AC and AC classes in Mail amd Express trains, the fare has been increased by two paisa per km and 4 paisa per km respectively.

"Costs keep going up. In fact after (implementation of) the 7th Pay Commission, costs have gone up drastically and therefore there is a... miniscule increase. Considering the cost and losses of Rs 55,000 crore, this will barely compensate 5 per cent of Rs 55,000 crore over the whole year," the minister said.

He said as against the current Rs 55,000 crore losses, Indian Railways suffered Rs 8,000 crore losses in 2004. Terming price increase a sensitive matter, Goyal said,

"This is a drop in the ocean towards making railways self- sufficient. Otherwise it will be impossible to improve or provide the services."

Goyal said Indian Railways has been continuously upgrading its services and facilities and during the last 5.5 years, it has undergone significant improvement in level of services, punctuality, cleanliness of stations, safety track record and the replacement of old and worn out equipment.

"Due to all these measures while on the one hand we are improving the railways operations and its passenger services, there is obviously a huge cost element," he said.

Goyal said there is no increase in suburban fare and the passenger segment of it comprised about 66 per cent of total number of passengers.