A lot of good things have been said about the IRlys and it is true that many new facilities had been provided in recent years, thanks to great efforts by our dynamic RM. IRlys do deserve to increase fare for the same, but in a justified manner. Following facts give a sorry picture about what could be actual intention behind these beautiful words said/ rosy picture presented:
(1) With only 10% of general seats (and only 6% of total seats as about 30% Tatkal & 10% VIP quota is there) are being offered at regular fare. There is no sanctity of general fare. It should have been other way round. i.e. selling 50% seats at regular fare then increase the fare...
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in slabs. It means today the scenario is the maximum surge fare is the normal fare and the initial few seats are cheaper seats (as is the case with airlines).
(2) 50% rise is too steep and that too maximum number of seats (60%) shall be sold at this price i.e. a forceful punch! albeit after wearing gloves! “Halka sa dikhne wala jhatka haqeekat mein bada jor se lagega”.
(3) In flexi price discounts are given to early birds i.e. on some seats sold in advance and charge premium on some seats at last minute i.e. on demand seats as is done by airlines. Some times even discounts are given in last minute if seats go vacant i.e. demand is less than supply. But here there is only rise and rise and rise with full guarantee & transparency, so it is an act of surge pricing and not just flexi pricing. As claimed it is very transparently flexible but with an avg price rise of 37.5% which will actually be much higher due to fact that RAC and WL tickets shall also be issued at maximum price. It should be actually about 40% or may be more as many passengers are compelled to travel with RAC/ wait listed tickets due to non availability of confirmed reservation.
(4) Although no demand based discounts are given in the proposed dynamic fare over the normal fare , the last minute higher charging had already been exploited by IRlys to the hilt through tatkal/Premium tatkal. With tatkal/ Suvidha/ Special fare already in place, yet another scheme to charge extra looks somewhat unethical. Shall tatkal scheme be dropped or the tatkal charges shall be also increased by 50% which is a logical conclusion, as cost of ticket offered on tatkal at last minute must be more than the ticket booked months in advance through surgi pricing.
(5) Surge pricing is for 142 high end trains out of 3200 ME trains 1.e. 4.4% of the total trains is a valid point the a figure of 1.1% of total trains is again irrelevant justification as the flexi pricing is for reserved passengers and unreserved passengers have nothing to do with it. Actually 10% of reserved passengers are affected today 0.65% figure is not relevant.
(6) Base fares for Rajdhani trains are already higher than SF trains (very rightly), as they are given priority over other trains, and have an avg speed 10-20 kmph higher than other SF trains on the route. Using the same justification for further increment under the veil of flexi pricing is nothing but a hidden intention to extend the same to all the trains in near future.
(7) IR recovering 56% of total cost of travel is again misleading. How much IR is recovering from ACC, ACIII, ACII is not just 56% of total cost in fact more than 100% i.e. already making profits by charging higher than the actual costing. It was learnt that IR was earning maximum in ACC & ACIII classes. Now it wants to profiteer with a profit margin of 50%! Exclusively from the middle class. Drastically increasing the fares for these classes and sparing ACI from the hike is again like robbing the middle class in the name of poor classes and sparing the high class people which actually have much higher paying capacity.
(8) In the present Income tax structure in our country, the middle class people and high class people are treated at par at same rate of 31%+surcharges.
Below Rs. 2.5 lac p.a. –real poor no tax charged
Between 2.5 lac to 10 lac pa income tax charged from 10% to 30%
Whole richness is measured in a narrow scale of 2.5 lacs to 10 lacs pa. And from 10 lacs pa to 10+ Crores pa, there is no differentiation, much to the detriment of middle class.
(9) Fact that share of richest 1% of Indians in the national wealth has grown from 36.8% in 2000 to 53% in 2015 where as in capitalist country like USA, the figure is only 37.3%. Also wealth of next 9% (2-10) 10% has came down from 29.1% in 2000 to 22.7% in 2015. (Credit Sussie global wealth data book 2014 & 2015). This indicates that the very rich ones are eating into the wealth of not so well offs. Quite expected!
(10) Handshake (clandenstine) for high class, generous booty to poor class and kick for middle class. How many of the actual beneficiaries of subsidies are actually poor is again a difficult question? Many well offs (esp. the non salaried ones) are availing these subsidies by not disclosing their income thereby making a mockery of the honest taxpayers. (about only 2% Indians are actually paying Income tax and are mostly salaried ones who does not have opportunity to hide income!)
(11) Probably Rail travel is considered more essential for survival of poor than basic necessities like grains, food, shelter etc, that is why the second class rail travel has been freezed since several years and no Govt is willing to increase it in spite of heavy inflationary pressure. Where as the prices of essential commodities has increased many fold during this marathon “freeze” period.
(12) Due to the long freezing (probably for ever?), the second class fares have fallen to ridiculously low levels due to high inflation. Carrying more than 90% of passengers at ridiculously low fare (hardly recovering 20-25% of costing from them) and attempting to make up for it by profiteering (with 50% margin or more) from the remaining 5-10% (mostly middle class), whilst sparing top class ACI paxs is an indication of today’s ironical state of affairs.
(13) Villages and towns situated along the railway lines are much well off than the remote villages served by roads. Poorest of Indians live in these remote villages (mostly not served by IRlys), and they pay much higher fares charged by buses operated by Government/ private operators which carry about 3-4 times the number of poors carried by IRlys. So I Rlys can never become real champion of poors in India. If State Govts, who are supposed to take care of the administration & well being of its residents charge much higher from the residents of its state for bus travel then why should Railways bear the huge subsidy of carrying them at ridiculously low price?
(14) Almost every RM tried to steal the show from PM/ CMs by becoming champion of poor (esp. of his/her state) by making proud announcements in the Railway Budgets, at the cost of railway travelers. The fare charged by the govt. buses should be bench mark to fix the ordinary railway fares for realistic pricing rather than fearing to rise fare. I.Rlys is now caught in a vicious circle of Impractical/Opportunistic Opposition/Media and politically expedient rulers.
(15) Operating so many schools, colleges, hospitals, Kolkata Metro etc is an encroachment by IRlys into the area of other Govt deptts like education, health, Urban development, State Govts etc. There is PM for nation, CM for states to take care of welfare of people, RM is supposed to concentrate on Rlys, but it did not happened. If IRly is merging its budget into the finance, then why not merge (i.e. hand over) these non-core activities to other deptts which are meant to and are expert in handling these activities.
(16) Frittering away scarce resources to non core areas since independence inorder to do the Job of state Govts, and neglecting the Railway network has resulted in deficient expansion of railway network/service as compared to demand. Now charging heavily to middle class travelers (acc/acIII/SL) in the name of demand is gross injustice. No where is the Govt Rlys profiteering from its ac class passengers. Even in developed countries like France, Germany etc, Govt is providing subsidy to travellers of TGV/ ICE trains. I.Rlys on the other hand is presently earning modest profits from ac class passengers.
No body can deny the fact that poor need to be subsidized, but how and to what extent is the crux of the problem. Level of subsidies should be practical i.e. it should be properly managed, strictly regulated and targeted so that its quantum is within manageable levels. Cost cutting, Rationalisation/ Simplification of IRly operation & maintenance practices, Commercially sound economic policies, Hiving off unwanted assets/ activities etc are must to take IRly out of financial crisis.