The Minister of Railways, Dinesh Trivedi, presented the Railways Budget 2012 to Parliament on 14th March. While commenting on the financial position of Railways, the Minister said that 'the Indian Railways are passing through a difficult phase'. The Operating Ratio for the closing year is now estimated to equal 95%. This is significantly higher than the 91.1% figure budgeted last year. Operating Ratio is a metric that compares operating expenses to revenues. A higher ratio indicates lower ability to generate surplus. Surplus is used for capital investments such as laying of new lines, deploying more coaches etc. Therefore, a smaller surplus affects the Railway’s capability to make such investments. Budget v/s Revised estimates 2011-12 Budget 2011-12 had estimated the performance of Railways for the financial year. Revised estimates have now been submitted. Taken together, these two figures help in comparing actual performance against targets. Some observations are enumerated below:
Budget estimates 2012-13 In 2012-13, Railways plan to improve Operating Ratio to 84.9% and to increase surplus to Rs 15,557 crore. This is more than 10 times the surplus generated in 2011-12 (Revised Estimates). The effective increase in freight rates is estimated to average 23%. During this time, passenger fares are also estimated to increase by an effective average rate of 19%. [1] Infrastructure Performance during the 11th Plan Under the 11th Five Year Plan, the total plan expenditure for Railways had been approved at Rs 2,33,289 crore. The Outcome Budget shows that the actual expenditure is only likely to be Rs 1,92,291 crore. Thus, expenditure will fall short by Rs 40,998 crore. This gaps exists despite a significant increase in the Gross Budgetary Support approved by Parliament. Plan expenditure during 2007-12 (In Rs Crore)
|
Approved Expenditure |
Actual Expenditure |
|
| Gross Budgetary Support |
63,635 |
75,979 |
| Internal Resources |
90,000 |
67,763 |
| Extra Budgetary Support |
79,654 |
48,549 |
| Total |
2,33,289 |
1,92,291 |
The Standing Committee on Railways, in its 11th report presented in August 2011, had sought an explanation from the Ministry. According to the Ministry, lower mobilization of internal resources and lack of extra budgetary support are the main reasons for the shortfall. Internal resource mobilization has been low because of (i) impact of the 6th Pay Commission; and (ii) slow growth in freight earnings due to the economic slowdown. Extra budgetary resources have been low due to non-materialization of funds through the Public-Private Partnership route. Proposals for the 12th Plan Two recent committees – Kakodkar Committee on Railway Safety and the Pitroda Committee on Railway Modernization – have called for large investments in the next five years. The Kakodkar Committee has recommended an investment of Rs 1,00,000 crore in the next five years to improve safety; the Pitroda Committee has recommended an expenditure of Rs 3,96,000 crore in the next five years on modernization. The Railway sub-group of the 12th Five Year Plan has also estimated a requirement of Rs 4,42,744 crore for various other investments proposed to be undertaken during the Plan period. [2] All three groups have called for significant investments in infrastructure augmentation in the next five years. Budget proposals 2012-13 According to the Minister’s speech, the Annual Plan outlay for the year 2012-13 has been set at Rs 60,100 crore. The plan would be financed through:
What happens now? The Budget is likely to be discussed in the two Houses within the next few days. Post the discussion, the Ministry's proposals will be put to vote. Once passed, the Ministry can put its proposals into action. For more details on the Railway Budget, including the projects proposed this year and the status of proposals made last year, please see our analysis here. To understand some of the challenges faced by the Indian Railways, see our blog post from last year. Notes: [1] The ‘effective average fare’ has been calculated by dividing the total income from the segment (freight/ passenger) by the total traffic (in NTKM/ PKM). This would vary with changes in fares as well as the usage by different categories of users (including the proportion of tickets booked through Tatkal). [2] Source: Report of the Expert Group on Railway Modernization (Chairman: Sam Pitroda)
The Ministry of Human Resource Development released the draft National Education Policy, 2016 in July this year.[1] The Ministry was receiving comments on the draft policy until the end of September 2016. In this context, we provide an overview of the proposed framework in the draft Policy to address challenges in the education sector. The country’s education policy was last revised in 1992. It outlined equitable access to quality education, with a common educational structure of 10+2+3 years. The draft Policy 2016 aims to create an education system which ensures quality education and learning opportunities for all. The focus areas of intervention of the draft Policy are: (i) access and participation, (ii) quality of education, (iii) curriculum and examination reforms, (iv) teacher development and management and (v) skill development and employability. Through these key interventions, the draft Policy provides a framework for the development of education in the country over the next few years. We discuss the key areas of intervention below.
Access and participation 
Presently in the country, enrolment at pre-school levels for children between the ages of 3- 5 years is low. 38% of children in this age bracket are enrolled in pre-school education in government anganwadi centres, while 27% of the children are not attending any (either government or private) pre-school.[2] In contrast, the enrolment rate in primary education, which is class 1-5, is almost 100%. However, this reduces to 91% in classes 6-8 and 78% in classes 9-12.[3] The trend of lower enrolment rates is seen in higher education (college and university level), where it is at 24%.[4] Due to low enrolment rates after class 5, transition of students from one level to the next is a major challenge. Figure 1 shows the enrolment rates across different education levels. With regard to improving participation of children in pre-school education, the draft Policy aims to start a program for children in the pre-school age group which will be implemented in coordination with the Ministry of Women and Child Development. It also aims to strengthen pre-school education in anganwadis by developing learning materials and training anganwadi workers. Presently, the Right to Education (RTE) Act, 2009 applies to elementary education only. To improve access to education, the draft Policy suggests bringing secondary education under the ambit of the RTE Act. However, a strategy to increase enrolment across different levels of education has not been specified. Quality of education 
A large number of children leave school before passing class eight. In 2013-14, the proportion of students who dropped out from classes 1-8 was 36% and from classes 1-10 was 47%.3 Figure 2 shows the proportion of students who exited the school system in classes 1-8 in 2008-09 and 2013-14. Among the population of children who stay in school, the quality or level of learning is low. The Economic Survey 2015-16 noted that the proportion of class 3 children able to solve simple two-digit subtraction problems fell from 26% in 2013 to 25% in 2014. Similarly, the percentage of class two children who cannot recognize numbers up to 9 increased from 11.3% in 2009 to 19.5% in 2014.[5] To address the issue of learning levels in school going children, the draft Policy proposes that norms for learning outcomes should be developed and applied uniformly to both private and government schools. In addition, it also recommends that the existing no-detention policy (promoting all students of a class to the next class, regardless of academic performance) till class 8 be amended and limited to class 5. At the upper primary stage (class six onward), the system of detention should be restored. Curriculum and examination reforms It has been noted that the current curriculum followed in schools does not help students acquire relevant skills which are essential to become employable. The draft Policy highlights that the assessment practices in the education system focus on rote learning and testing the students’ ability to reproduce content knowledge, rather than on understanding. The draft Policy aims to restructure the present assessment system to ensure a more comprehensive evaluation of students, and plans to include learning outcomes that relate to both scholastic and co-scholastic domains. In order to reduce failure rates in class 10, the Policy proposes to conduct examination for the subjects of mathematics, science and English in class 10 at two levels. The two levels will be part A (at a higher level) and part B (at a lower level). Students who wish to opt for a vocational stream or courses for which mathematics, science and English are not compulsory may opt for part B level examination. Teacher development and management It has been observed that the current teacher education and training programs are inadequate in imparting the requisite skills to teachers. The mismatch between institutional capacity to train teachers and required supply in schools results in a shortage of qualified teachers. At the level of classes 9-12, the Rashtriya Madhyamik Shiksha Abhiyan prescribes a teacher-pupil ratio of 1:30.[6] However, some states have a higher teacher-pupil ratio: Chhattisgarh (1:45), Bihar (1:57) and Jharkhand (1:68).3 In various central universities, the total number of sanctioned teaching posts is 16,339, of which 37% are lying vacant.[7] The draft Policy recommends that state governments should set up independent teacher recruitment commissions to facilitate transparent, merit based recruitment of principals, teachers, and other academic staff. For teacher development, a Teacher Education University should be set up at the national level to focus on teacher education and faculty development. In addition, the draft Policy also states that all teacher education institutes must have mandatory accreditation. To ensure effective teacher management, periodic assessment of teachers in government and private schools should be carried out and linked to their future promotions and increments. Skill development and employability It has been noted that the current institutional arrangements to support technical and vocational education programs for population below 25 years of age is inadequate. The social acceptability of vocational education is also low. Presently, over 62% of the population in the country is in the working age-group (15-59 years).[8] Only 10% of this workforce (7.4 crore) is trained, which includes about 3% who are formally trained and 7% who are informally trained.[9] In developed countries, skilled workforce is between 60-90% of the total workforce.[10] The draft Policy proposes to integrate skill development programs in 25% of schools and higher education institutions in the country. This is in line with the National Skill Development and Entrepreneurship Policy that was released by the government in 2015. The draft Policy 2016 focuses on important aspects that have not been addressed in previous policies such as: (i) curriculum and examination reforms, and (ii) teacher development . Although the Policy sets a framework for improving education in the country, the various implementation strategies that will be put in place to achieve the education outcomes envisaged by it remains to be seen. For an analysis on some education indicators such as enrolment of students, drop-out rates, availability of teachers and share of government and private schools, please see our Vital Stats on the ‘overview of the education sector’ here. [1] Some Inputs for Draft National Education Policy 2016, Ministry of Human Resource Development, http://mhrd.gov.in/sites/upload_files/mhrd/files/Inputs_Draft_NEP_2016.pdf. [2] Rapid Survey on Children, 2013-14, Ministry of Women & Child Development, Government of India, http://wcd.nic.in/sites/default/files/RSOC%20FACT%20SHEETS%20Final.pdf. [3] Secondary education in India, U-DISE 2014-15, National University of Educational Planning and Administration, http://www.dise.in/Downloads/Publications/Documents/SecondaryFlash%20Statistics-2014-15.pdf. [4] All India Survey on Higher Education 2014-15, http://aishe.nic.in/aishe/viewDocument.action?documentId=197. [5] Economic Survey 2015-16, Volume-2, http://indiabudget.nic.in/es2015-16/echapvol2-09.pdf. [6] Overview, Rashtriya Madhyamik Shiksha Abhiyan, Ministry of Human Resource Development, http://mhrd.gov.in/rmsa. [7] “265th Report: Demands for Grants (Demand No. 60) of the Department of Higher Education”, Standing Committee on Human Resource Development, April 2013, 2015, http://164.100.47.5/newcommittee/reports/EnglishCommittees/Committee%20on%20HRD/265.pdf. [8] “Ministry of Skill Development and Entrepreneurship: Key Achievements and Success Stories in 2015”, Ministry of Skill Development and Entrepreneurship, Press Information Bureau, December 15, 2015. [9] Draft Report of the Sub-Group of Chief Ministers on Skill Development, NITI Aayog, September 2015, http://niti.gov.in/mgov_file/Final%20report%20%20of%20Sub-Group%20Report%20on%20Skill%20Development.pdf. [10] Economic Survey 2014-15, Volume 2, http://indiabudget.nic.in/es2014-15/echapter-vol2.pdf.
