The general discussion on the Railway Budget concluded in Parliament this week. During the discussion, several MPs made a reference to two important documents tabled by the Railway Minister in 2009 - the ‘White Paper' on Indian Railways and the 2020 Vision document. The documents provide good insight into the operational and financial performance of Railways over the previous five years. They also throw light on the challenges that confront the Railways today. It emerges that Railways has relied heavily on increasing utilization of existing assets to manage the increase in demand. The system is otherwise severely constrained by lack of adequate capacity. Scenario so far (2004-09) Growth in traffic and earnings Rail transport demand is linked to the growth in GDP. As a result, the two main businesses of Railways – Passenger and Freight – have both seen significant increases in traffic in recent years. Passenger traffic has grown at an average rate of 10% each year. Earnings have increased at a slightly higher pace, implying that most passengers have been spared increases in fare. Standalone, passenger operations have continued to be loss making. Freight traffic has grown too, but at a lower rate of about 7% and unlike the passenger segment, freight fares have increased significantly over these years. Freight forms the backbone of Railways' revenues. Even today, it continues to account for almost two-thirds of total earnings. However, Railways’ market share in freight has decreased steadily over the past few decades - it dropped from 90% in 1950-51 to less than 30% in 2007-08. The main reasons for this decline are high pricing (to subsidize passenger travel) and lack of sufficient infrastructure. Railways are unable to provide time-tabled freight services. In addition, there are no multi-modal logistics parks that could have provided door-to-door cargo services. Infrastructure constraints Since 1950-51, route-kms have increased by just 18% and track-kms by 41%, even though freight and passenger output has gone up almost 12 times. Specific issues include:
The above constraints require investment in network and capacity augmentation, including dedicated freight corridors. Hence, a substantial increase in funding is necessary. The Vision 2020 document planned to deploy Rs 14 lakh crore in the next 10 years towards development of rail infrastructure. Recent trends (as presented in the Budget 2011) This year's budget presented the actual financial performance in 2009-10, the provisional performance in 2010-11 and the targets for 2011-12 (Details can be accessed here). It also highlighted achievements on other metrics, including growth in traffic and augmentation of infrastructure (See 'Status of some key projects proposed in 2010-11'). On financials, 2009-10 was a bad year for Railways. Figures show a high Operating Ratio of 95.3%. Operating Ratio is a metric that compares operating expenses to revenues. A higher ratio indicates lower ability to generate surplus. The 2009-10 Operating Ratio is the highest since 2002. According to the Railways Minister, this can be partly attributed to higher payout in salaries and pension due to implementation of Sixth Pay Commission recommendations. Growth in passenger traffic remained high in 2010-11, at 11%. However, growth in freight traffic slowed down to 2%. Again, passenger fares remained untouched, but freight fares were increased. Railways, in 2011-12, targets an increase of 8% in both passenger and freight traffic. Financials are expected to improve. An amount of Rs. 57,630 crore has been budgeted as net plan outlay for investment in infrastructure. Last year, this figure was Rs 41,426 crore. In her opening remarks during the Budget speech in Parliament, the Minister commented that Railways forms an important backbone of any country. Lets hope it is headed in the right direction!
With 4,203 confirmed cases of COVID-19, Maharashtra has the highest number of cases in the country as of April 20, 2020. Of these, 507 have been cured, and 223 have died. In this blog, we summarise some of the key decisions taken by the Government of Maharashtra for containing the spread of COVID-19 in the state.
Measures taken prior to lockdown
By March 12, the state had registered 11 cases of COVID-19. Consequently, the state government took measures to: (i) prepare hospitals for screening and testing of patients, and (ii) limit mass gathering given the highly contagious nature of the disease. The measures taken by the government before the lockdown are summarised below.
Health Measures
On March 14, the government notified the Maharashtra COVID-19 regulations to prevent and contain the spread of COVID-19 in the state. Key features of the regulations include: (i) screening of COVID-19 patients in hospitals, (ii) home quarantine for people who have travelled through the affected areas, and (iii) procedures to be followed in the containment zones, among others.
Movement Restrictions
On March 15, with 31 COVID-19 cases in the state, the Department of Public Health ordered the closure of cinema halls, swimming pools, gyms, theatres, and museums until March 31. On March 16, all educational institutions and hostels in the state were closed till March 31. The teaching staff was advised to work from home. All exams were also deferred until March 31.
Administrative Measures
On March 13, the Maharashtra government constituted a high-level committee to formulate guidelines for mitigating of the spread of COVID-19 in the state. The responsibilities of the committee included: (i) taking a daily review of the status of COVID-19 in the state, and (ii) implementing the guidelines issued by the World Health Organisation and the Ministry of Health.
On March 17, the first casualty due to COVID-19 occurred in the state. On March 19, the government put restrictions on meetings in the government offices and issued safety guidelines to be followed in these meetings.
On March 20, considering the unmitigated spread of COVID-19 in Mumbai, Pune and Nagpur, the attendance in government offices was restricted to 25%. Subsequently, on March 23, the government limited the attendance in government offices to 5% across the state.
Measures taken post-lockdown
To further restrict the movement of individuals, in order to contain the spread of the disease, the state government enforced a state-wide lockdown on March 23. This lockdown, applicable till March 31, involved: (i) closing down of state borders, (ii) suspension of public transport services, and (iii) banning the congregation of more than five people at any public place. Entities engaged in the supply of essential goods and services were excluded from this lockdown. This was followed by a nation-wide lockdown enforced by the central government between March 25 and April 14, now extended till May 3. Before the extension announced by the central government, the state government extended the lockdown in the state till April 30.
On April 15, the Ministry of Home Affairs issued guidelines on the measures to be taken by state governments until May 3. As per these guidelines, select activities will be permitted in less-affected districts from April 20 onwards to reduce the hardships faced by people. Some of the permitted activities are (i) agriculture and related activities, (ii) MNERGA works, (iii) construction activities, (iv) industrial establishments, (v) health services, (vi) certain financial sector activities among others subject to certain conditions.
Welfare Measures
To address the hardship being faced by residents of the state due to lockdown, the state took several welfare measures summarised as follows:
On March 30, the School Education Department issued directions to all schools in the state to postpone the collection of school fees until the lockdown is over.
The Department of Tribal Development issued directions to provide food/dietary components at home to women beneficiaries and children under Bharat Ratna Dr A.P.J. Abdul Kalam Amrut Aahar Yojana.
The state government issued directives to the private establishments, industries and companies to pay full salaries and wages to their employees.
On April 7, the state Cabinet decided to provide wheat and rice at a subsidised price to all Above Poverty line ration card holders and Shiv Bhojan at Rs 5 for next three months in all Shiv Bhojan centres.
On April 17, the Housing Department notified that landlords/house owners should defer the rent collection for three months. No eviction will be allowed due to non-payment of rent during this period.
Administrative Measures
On March 29, the public works department issued directions suspending the collection of tolls at PWD and MSRDC toll plazas for goods transport until further direction.
MLA Local Development Program: Under MLALAD program, a one-time special exception to use the MLALAD funds was given to legislators for the purchase of medical equipment and materials for COVID-19 during the year 2020-21.
Analysing the impact on the economy of the state: On April 13, the government constituted an Expert Committee and a Cabinet Sub-Committee to analyse the implications of COVID-19 on the economy of the state. These committees will also suggest measures to revive the economy of the state.
Orders relating to Mumbai city
On April 8, the city administration made it compulsory for all people to wear masks in public places.
On April 10, the Commissioner of Police, Greater Mumbai issued an order prohibiting any kind of fake or distorted information on all social media and messaging applications. The order is valid until April 24.
For more information on the spread of COVID-19 and the central and state government response to the pandemic, please see here.
