The Hindu Business Line : Rly Budget: Plan size likely to go up by Rs 200 cr

As per signals emanating from the Rail Bhawan, the headquarters of the Railway Ministry currently in the midst of Budget making exercise, the Budgetary support from the Central Exchequer is likely to be maintained at the current level of Rs 5,840 crore given the general squeeze anticipated in the support for infrastructure sectors including railways, Railway Ministry sources said.

The Finance Ministry is looking at curtailing the budgetary support for infrastructure sectors from the Rs 1,34,500 crore recommended by the Planning Commission to about Rs 1,17,060 crore.

"If this happens, it will obviously affect the railways as well ", the sources said. The Railway Minister, Mr K. Nitish Kumar, is expected to take up the issue of the increased Budgetary support with the Finance Minister, Mr Jaswant Singh.

In case the Budgetary support is not increased, the Railways would have to resort to higher market borrowings through IRFC as the scope for increasing the internal resource mobilisation in terms of raising passenger and freight rates is considered to be less, the sources said.

"Due to political expediency, the scope for a substantial hike in passenger fares is minimal save for passing on the rise in inflation ", they added. The Railway budget for 2003-04 is expected to announce flexible pricing strategy for peak and non-peak hours in the second AC segment to keep up with the competition from the airlines.

As per this strategy, the Railways will extend discounts to commuters travelling in second AC during lean season to stem the possible flight of passengers from rail to air.

In the case of freight, Rail Bhawan feels that there is little room for hiking the tariffs except for rationalisation and re-classification of goods to mop up additional revenues. "It is widely felt that the freight rates have reached saturation point and any increase here will only result in diversion of goods traffic from rail to road ", the sources said.

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