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Instead of rail fare hike explore these avenues to raise revenues

How much revenue is lost to the Indian Railways every year with free passes and also decide who gets to travel free and why on our expense

The recent hike in rail fares in India have been discussed, analysed, commented, and largely decried by many. To be fair to all concerned, a random check on leading opinion makers and decision influencers shows that almost all of them have not travelled on a train, after buying their own ticket with their own money, in a long time. Travelling for a holiday in AC Chair Car on Shatabdi Express type trains does not count, incidentally, because it does not reflect the realities. As a long time railway fan, frequent train user, and also as one who has grown up in railway towns, I would like to make the following suggestions to help the Indian Railways generate more revenue.


# Charge a premium for 1AC (first class air-conditioned) at the time of general booking itself, instead of keeping them "on hold" for a variety of priority quota type passengers. Passengers, who travel 1AC, would easily pay a premium of, say 50%, over the basic fares for this;


# Stop including water & foods in the ticket prices and charge for all meals and beverages supplied. As it is, the food quality is dropping on a daily basis. Besides, many regular travellers choose to bring their own food. Also, thanks to mobile phones, fresh hot meals are now being delivered on platforms at your window all over the country;


# Charge for refundable deposit on every item sold on trains, platforms or railway stations, which comes in plastic or similar packaging. The refund can be collected at the destination station. Or a whole new "system" will form where travelling salesmen and vendors would do instant refunds at a slight discount. This will solve multiple issues of garbage disposal as well as cleanliness;


# Utilise land banks blocked off for decades, on account of patronage all over the country. Make the list transparently available on the Indian Railways website. This could be combined with building vertically on railway stations to provide commercial space for internal usage as well as for rent to private organisations. Some of the old colonial era bungalows could be let out as heritage hotels, while the railway officials could reside in apartments;


# Place advertisements inside the passenger coaches. The external parts of the coaches are already being used for advertisements;


# Give some serious competition to the parcel and courier business by encouraging more trains with mixed parcel van and passenger coach configurations, like the Sampark Kranti express trains;


# Scrap the dreams of high speed trains on the same tracks used by goods trains and normal trains. More time and money is lost than is earned in blocking paths for overtakes. Rationalise all MPS (Maximum Permitted Speeds) to 110 kmph or 130 kmph until the slower trains can catch up. Otherwise fresh lines need to be laid;


# Charge extra for lower and upper berths as compared to side berths (present in 2AC, 3AC/3-tier) and middle berths (present in 3AC/3-tier). A lower berth can generate a premium of at least 50%, and an upper berth of at least 25%, over the standard fares.


# Take all railway saloons, including the one lying unused at State Entry Road for post funeral trips to Allahabad, and place them up for rent as either static hotels or for travel-by-anybody who can pay. It is estimated that with the growth in number of railway zones, there are about 360 8-wheeler saloons lying ready for this purpose on an all-India basis. Each one is fitted out better than the other.


The railway ministry should also make the whole system of free passes and travel transparent. For instance, how much revenue is lost to the Indian Railways every year with these free passes? Likewise, the users ought to know who gets free travel passes and the reason why.


The railway ministry should also explain to us why trains which show up as fully sold out, and booked months in advance, actually end up running with empty seats, made available for the highest bidder. Regular travellers are not blind or foolish either.


An increase in prices appears to be inevitable. An increase in inefficiency is not. The Indian Railways do a wonderful job of knitting the country together, but they also need to be more transparent in the way they go about this, and the above steps, which may not raise much by way of direct revenue, will certainly help in getting an understanding from us users of the real issues.


Otherwise, it appears like the behaviour of a monopoly—prices will be increased because they can increase them.



Sudheer M

4 years ago

Veeresh Ji,
A few suggestions more:
1. Have a tie up with Water purifier companies and set up a free drinking water facility maintained by them. In return, the kiosk of water supply machine can display their advertisement.
2. Have a tie up with the "GlamouR Room" type companies to maintain the toilets of the waiting room. In return a beautifutl display of this is a "Glamour Room" toilet can be made.
3. "So Many" number of vitrified tiles can be laid and maintained by them in the platform in return of an advertisement.
4. Strategic location of railway stations can be utilized for super markets in the ground floor and offices/shopping complexes in the upper floors.
5. Worst case, name the trains with company/product names like Kurla XYZ express, where in XYZ company will not only pay for the naming, but also handle the maintenance(cleanliness) of the train.

Avenues are many, but we have kept our thinking hats locked in the cupboard.


Vinay Joshi

In Reply to Sudheer M 4 years ago

All these things are dud among our thought inputs!

Mr.Sudhir, yes revenue generation accepted. That's all.

Veeresh, you've not known the tenacity of the railways, the largest employer, appreciate the concern.

Miniscules aspects are of no use with 95% operating ratio WHICH YOU'VE NOT ANSWERED - possibly CAN'T!? NEVER CAN!?

Yov've neither answered me on 'rat biryani'! FYI - in South West Delhi, wrong order dispatch by none other than McDonald, non veg burger,[palatable]- that apart - the consumer redressal forum awarded 10K compensation + 5K cost i.e 15K.

Why railway should not be sued upon, seek 1KCR/2KCR compensation by the said pilgrims. ARE YOU talking about this? No response!

All suggestion put forth, including you - is zero sum game.

Another rate hike is in the offing in the ensuing railway budget.

Veeresh before that summarily put up the expected revenue to be garnered by the forum suggestions!?

Such cosmetic financials neither can make the railways work efficiently, Value for Money, OR CAN improve its financials, 95% operating ratio.

Veeresh hope you are not 'BOTOX' surgeon,for financials, that too for railways w/o understanding of the financials!?



4 years ago

Your Article is nice and gives practical solutions for raising revenue for Railways, instead of the easiest way of resorting to increasing fares for the public. Ex Rly Minister Lallu Prasad Yadav needs to be complemented for not raising fares for long time.
What applies to Railways applies more to General budget. Instead of controlling huge wasteful exp & not controlling leaks occurring due to corruption, the FM resorts to the easiest way of raising service tax, excise, VAT, stamp duty etc. which all contribute to heavy inflation (which does not affect FM & all Ministers).


4 years ago

As regards to Railway fare hike, Hon Rly Minister /Rly administration may justify it by stating that Railway fares were not increased since many years & there is overall increase in all services. But as per my opinion it is half true & other half part is never replied by Railway administration/Hon railway Minister.
The reply dated 20/12/2012 from Railway Board is surprising & shocking. In reply to my RTI application on ‘Economic viability & audit findings on of Train operations. (UNDER INDIAN RAILWAYS), Railway board has replied that ‘Economic viability of operating any train is not worked out as train wise figures of profitability, earning & expenditure are not maintained in Indian railways. If the reply is true, then it is beyond understanding that how/what factors are considered by the Hon Railway Minister/Rail Administration while taking decision on operating/continuing any train in the country. Their reply appears to be contradictory to the Hon CAG findings.

Hon CAG has observed in their report as below :- Report No. PA 26 of 200809 (Railways)

· Inadequate periodic assessment of demand and absence of cost benefit analysis as envisaged in the Corporate Plan of Indian Railways rendered nearly 30 per cent of the new trains introduced in nine zones operationally unviable.

· Indian Railways need to ensure that introduction of new trains is justified by a streamlined evaluation of demand, costs and benefits. Indian Railways also needs to devise a uniform mechanism for assessing introduction of trains, prescribe minimum occupancy yardsticks, specify the benefits accruing from social or other considerations and conduct a post introduction review to evaluate and justify continued operation of new trains.

· Procedural formalities prior to introduction of holiday/festival special trains should be finalised and trains lodged in the Passenger Reservation System well in advance of their first run to enable advance reservation and to optimise occupancy.

Hon Railway minister had increased fares for coping with the losses but it is felt that instead of increasing the fares, Railway administration should follow CAG reports, identify the loss pockets & control inefficiency, incompetency & corrupt practices prevailing in Railways to put less burden on the common man. It is felt that Railway officials should be held accountable for huge losses. Unless these drains are properly plugged, mere fare increase will not solve the problem of Railways. It will put unwarranted burden on Common man.

I have filed more than 25 RTI applications with railways during last 2 years on various issues, which revealed that efficient operations & economic viability is not properly reviewed. It is felt that either audit reviews are not properly carried out or audit findings are overruled by the authorities for pleasing certain political/other interests.

In the Central Railway Zone, It is noticed that Central Railway alone had suffered loss of Rs 903.61 Crores in Year 2009-10 & Rs. 522.56 Crores in year 2008-09. It is noticed for 41 trains (which include Special Trains) have operated with just 13.61% occupancy & actual earning was only 16.63% of the potential earning. It is also noticed for operating with whopping loss of about 240 Crores is evident for the 10 Trains operating with 61.70% occupancy & actual earning was about 57.17%. Operating Cost of those trains is about Rs 310 Crores. These Trains have earned Rs 63.44 Crores against Earning potential of Rs 111 Crores. It is felt that, if such train operations across the India are identified & stopped, there will be less necessity of raising the fares & burden on the passengers.


Veeresh Malik

In Reply to AVINASH PRABHUNE 4 years ago

Dear Avinash Prabhune ji, thank you for writing in, and providing such important information.

I shall try and use some of what you have written in about.

Interim, you and other readers here may wish to read this article, also:-


Vinay Joshi

4 years ago

No one would want to eat on board the trains when they serve 'rat' biryani. Luckily no one had any problems as not many had eaten it.

What is the info you have secured under RTI?



Veeresh Malik

In Reply to Vinay Joshi 4 years ago

Dear Vinay ju, thank you for writing in, and yes, the quality of food served onboard trains, especially trains with pantry cars, has dropped considerably. Likewise, where food is part of the ticket price, there are similar issues.

Safer to bring food from home, if possible - or from known and reputed catering options. Or live on fruit, boiled eggs, bread and biscuits.


Vinay Joshi

In Reply to Veeresh Malik 4 years ago

Hello Mr. Veeresh,


I'm not talking of quality of food, at all, on board the trains. It's well known for ages.

I'm talking of 'life threatening', food, as stating 'rat biryani'.Yes rat biryani!

There's a report from A'bad from Mr.Prashant Dayal, TNN, ---- a family from Valsad returning from Vaishno Devi, on board Sarvodaya Express, had ordered three -VEG- biryani's.[not rat biryani's!?]

When their seven yr old son dug a spoon it was obstructed. It was found a 'RAT HAD BEEN COOKED IN THE BIRYANI'.

This 'horrifying' experience is not called - low quality food!?

The said family along with abt 100 odd pilgrims had ordered it.
There was no poisoning or death due to the family's alert.

A complaint has been lodged at New Delhi Rly stn, passengers had clicked on their cells 'the act' of waiters throwing the said BUT no samples drawn & sent for analysis.

THIS IS A BREACH OF TRUST, rly's can be sued.Who will file a suit?

As regards rly financials what you've said are not aspects. To what extent can it garner revenues? BUT what about operating ratio of 95%?

In depth forensic analysis is different a matter.



In Reply to Vinay Joshi 4 years ago

I think following amatter will provide some solution in the matter of RAT biryani case
This is for sharing the information & creating awareness to put pressure on the system to improve nothing else

Brief Story of the Shri Avinash V. Prabhune.

Nagpurian, Shri Avinash Prabhune alongwith his wife Asmita, boarded the 2649 Sampark Kranti Express at Bangalore(Yashvantpur) on 02/09/2007 at 2145 hrs in AC 3 tier Comparment for the journey upto Nagpur. As the train was commencing from Bangalore(Yashvantpur), it was the duty of Rail administration to provide proper lenin (bedding kits) to all passengers, moreover toilet door was not getting locked. Inspite of Complaints by the passengers, the Rail administration failed to take any corrective action & ultimately supplied wet, old & used Bedding kits to Passengers. Shri Avinash Prabhune protested & lodged the written complaint with Dy.C.T.I. during the journey. Sh Prabhune requested Rail Authorities to take stern action in the matter for avoiding the hardship to Consumers. Further requested to pay token compensation of Rs.100/- per passenger as Compensation for the negligence in providing services. But non courteous Rail administration has not shown courtesy of replying so Sh Avinash Prabhune was left with no choice than to file Complaint at Hon Dist Consumer Forum, Nagpur.

Commercial Manager, Central Railway, Nagpur submitted the reply of behalf of Railways & informed that quality bedrolls were supplied hence there was no deficiency in services. But in the mean time Sh Prabhune received letter from Dy. Chief Commercial Manager, South Western Railway, Hubli confirming the deficiency in services & had also informed that the concerned contractor had been fined with Rs.2000/-. But the said letter was silent about token compensation of Rs100/- as claimed by Sh Prabhune. So the reply filed by Commercial Manager, Central Railway, Nagpur turned out to be false. Hon Forum upheld the complaint in favour of Shri Avinash Prabhune & ordered Railways to pay Rs.6200/- within 30 days.

Hon Forum has ordered ADRM, Railways to :-

a) To pay Rs.100/- Per head (Total Rs.200/-) to Complainant for ‘Bad Treatment & Negligence’ by Respondents.

b) to pay Rs.5000/- as compensation for Mental & physical Agony.

c) to pay Rs. 1000/- as the Costs for complaint.

Hon President Mr. Nalin Majithia, Hon Member Shri Milind Kedar, Hon Member Mrs Nalini Harode passed the orders. Complainant Shri Avinash Prabhune represented the matter in person while Adv. Nitin Lambat appeared for Indian Railways.

Yours truly,





PHONE 9049800158

[email protected]


4 years ago

All littering must be fined. All businesses sticking ads for free must be charged for using space and for cleaning up. Heavily. Get RSS or similar to teach discipline e.g. to queue or carry less luggage.

Ramesh Iyer

4 years ago

I don't know how practicable the suggestions in the article are, but one thing the govt should do asap is to reduce booking window from 90 to 30 days prior to travel. Many years ago, it was increased to 60 and then 90 days, for inexplicable reasons. Later it dawned on people that Railways actually makes a lot of money in cancellations, as many prospective travellers book in advance and end up cancelling their travel plans (or rescheduling them) accruing huge amount of money to Railways for absolutely no services rendered. Moreover, most passengers don't plan their travel 90 days in advance, unless it's for a specific occassion, like a wedding they need to attend on a particular date. Most business travellers (and most A/c passengers are business travellers) plan their trip at a short notice.
I also fully agree that the govt must prune the list of people entitled to Free passes for ANY class of travel by trains. The list of freeloaders seems to increase every year, with tax-payers having to foot the bill for such largesse.


Veeresh Malik

In Reply to Ramesh Iyer 4 years ago

Dear Ramesh Iyer, thank you for writing in, and I agree, the booking period (which, btw, is now 120 days) needs to be brought down. Freeloaders of all sorts is an even bigger scandal. All this pales in front of the real estate scams.


Ramesh Iyer

In Reply to Veeresh Malik 4 years ago

Dear Mr. Malik, thank you for your insightful articles on the plight of Indian Railways, which you had the "privilege" of observing closely. I look forward to many more such articles from you which reveals so much about the largest employer of the GOI, and how much of a drain it is on the exchequer.
I agree with your suggestions in this article too, but doubt the weak UPA govt will show the courage to act on some "unpopular" ones.
I too have always enjoyed my train journeys much more than even air-travel, but am disappointed with deteriorating standards of hygiene and service levels of Railways over time.
The less said about the highly unregulated real estate sector scams the better !

Motorola to pay Rs18,000 for not rectifying defects in mobile

Despite taking his Motorola 'Defy' twice for repairs which included replacement of the mother board and a software upgrade, the handset's problems persisted, said the complainant

New Delhi: Motorola India has been directed by a consumer forum to pay Rs18,000 to a customer for not rectifying defects in a mobile phone sold to him, reports PTI.


The North District Consumer Disputes Redressal Forum said the Motorola 'Defy' handset, bought by the customer, was sent to the company's service centre twice for repairs.


Not rectifying the defects amounts to deficiency in service, the forum said.


"It is clear from the record that complainant had given the handset to authorised service centre of opposite party 1 (Motorola India Pvt Ltd) twice for repairs. Certainly, not rectifying the defects in the handset sold to the complainant is deficiency of service. In the circumstances, we are of the view that complainant is certainly entitled for refund of the price and also cost and compensation.


"In view of the reasons given above, we direct the opposite parties (Motorola and its authorised retailer) to jointly and severally pay a sum of Rs16,000, price of mobile phone. Complainant shall return the mobile handset to them. Apart from above, they are also directed to pay Rs2,000 as cost to the complainant," the bench presided by Babu Lal said.


The order came on the complaint by Delhi-resident Vinay Girdhar, who had alleged that the Motorola handset -- worth Rs16,000 -- developed problems barely a month after its purchase.


He had said the smartphone's processing speed had slowed down and it was restarting again and again.


Despite taking the phone twice for repairs which included replacement of the mother board and a software upgrade, the mobile handset's problems persisted, Girdhar had said.


Motorola India was proceeded against ex-parte as no one had appeared on its behalf despite the notice served on it.


Government to come out with modified DTC Bill: Shome

The Parliamentary panel had suggested raising the annual income exemption tax limit to Rs3 lakh as against Rs2 lakh proposed in the original DTC Bill and also to adjust subsequent tax slabs

New Delhi: The Union Government will come up with a modified Direct Taxes Code (DTC) Bill after incorporating the suggestions of the Standing Committee on Finance, which among things had suggested raising annual income tax exemption limit to Rs3 lakh, reports PTI.


"Will come out with modified DTC (Bill) in response to Standing Committee suggestions," said Parthasarathi Shome, Advisor to the Finance Minister, at a FICCI event.


He said the Finance Ministry is looking at the Bill and working on tax structures as suggested by the Parliamentary committee.


The Parliamentary panel headed by senior BJP leader Yashwant Sinha in its report (March 2012) had suggested raising the annual income exemption tax limit to Rs3 lakh as against Rs2 lakh proposed in the original DTC Bill. Current tax exemption limit is Rs1.8 lakh.


It has also suggested that subsequent tax slabs be adjusted accordingly to provide relief to people reeling under the impact of inflation. The DTC will eventually replace the over five decades old Income Tax Act.


"We are trying to see what could be the best in terms of transparency so that issues that are hurting industry could be covered adequately," Shome said.


He further said the Finance Ministry is also addressing the issue of expenditure control and that remains a major challenge.


"We are looking into expenditure efficiency. We should do more in terms of efficiency. Issues on expenditure side is being addressed. Expenditure control is a major challenge and is being addressed by the Finance Minister," he said.


The DTC Bill, tabled in August 2010, was referred to the Standing Committee for scrutiny.


Shome also said there has been some improvement on the government's non-plan expenditure side since the time of financial crisis in 2008.


Finance Minister P Chidambaram had in November 2012 announced a fiscal consolidation road map wherein he plans to restrict fiscal deficit at 5.3% of GDP in the current fiscal and bring it down to 3% by 2016-17.


Shome further said that the government is showing its intention to bring in clarity in tax laws and reforms in tax administration.


"We have to increasingly do so (tax reforms). That is going to be a vehicle and we won't put it on back burner," Shome said.


He also said the Ministry has asked National Institute of Public Finance and Policy (NIPFP) to calculate the impact of the proposed Goods and Services Tax (GST) on the GDP.



nagesh kini

4 years ago

Yes, the need of the hour is to bring sanity and not clarity in our tax laws. They are flawed badly.
The raising of the basic threshold ought to be Rs.5 lakhs factoring for the raging inflation. Some of the mindless exemptions, deductions and allowances can be done away with to achieve this.
There has to be a common assessment order under a single return form for Income, Wealth and Gift Tax with higher thresholds and lesser deductions for simplification has to be completed by the very same ITO.
All unearned incomes from dividends,interests, capital gains, rentals and agriculture in the hands of the super rich - those with gross income and wealth exceeding Rs. 1 crore should be subjected to a special surcharge not exceeding 10%.
The Estate Duty has to be revived and the same officer to complete the assessment.

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