The Hindu : Assocham seeks rationalisation of rail fares

Online edition of India's National Newspaper
Tuesday, Feb 25, 2003

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Business

Assocham seeks rationalisation of rail fares

By Our Special Correspondent

NEW DELHI FEB. 24. The Associated Chambers of Commerce and Industry of India (Assocham) has urged the Railway Minister to carry the process of rationalisation of freight rates further and improve finances by bringing passenger user charges closer to the cost of service.

It has suggested that the Ministry should be guided by the economics of improving passenger business.

A "please-all'' budget that tinkers with passenger fares and freight rates will certainly militate against the commercial interests of the Railways, the chamber says.

In a statement issued today, it says passenger services constitute nearly 60 per cent of the transport output but contribute only 32 per cent to its revenue. In 2000-01, losses due to passenger and other coaching services were estimated at Rs. 4,875 crores.

It maintains the rationalisation of freight rates is required because as much as 89 per cent of the freight traffic is contributed by eight major commodities — coal, fertilizer, cement, petroleum products, foodgrains, finished steel, iron ore and raw materials to steel plants comprising the core sectors. The balance 11 per cent is other commodities moved in bulk and in containers.

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