Jun 16 2014 : The Economic Times (Kolkata)
ET EXCLUSIVE Q&A - Passenger, Freight Fare Hikes: That's The Need of the Hour
DV SADANANDA GOWDA UNION MINISTER FOR RAILWAYS
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STRAIGHT ROUTE With the limited resources at hand, the new railway minister cannot dream big, unless there is co-operation from the respective state governments
It is two weeks since DV Sadananda Gowda took over as Minister for Railways.Still learning the ropes, the 61-year-old minister tells K R Balasubramanyam that the Centre will consider new projects only if the states share half the project cost. As for the prime minister's ambitious diamond quadrilateral, he says the ministry will be looking at options like PPP, FDI or bonds for funds. Edited excerpts: What will be the focus of your Budget next month?
We will be focusing on factors of safety, security and service. If we are able to implement these three successfully, then speed will be the fourth aspect we will be looking at.
But Railway finances are in a shambles...
Yes, resources are a big issue. Some ministers in the past looked at announcing new projects without bothering about their actual delivery. They did not see if resources were available to implement them. We have some ` .5 lakh crore (. ` 5 trillion) worth of projects, announced by earlier regimes, on ground. But the ministry gets only about ` . 25,000 to . 30,000 crore by way of net revenue. There ` is a grave mismatch between income and expenditure. Some ongoing projects in Southern and South Western Railways will take about 45 to 50 years to complete. This is because, in the past, if a project worth ` . 1,000 crore was announced, only about ` . 10-15 crore was earmarked by way of token allocation. And as we delay on projects, costs go up.
How can we deliver projects if this is the situation?
So, how will you deal with it?
In the past, the ministry never looked at new avenues for resources like PPP or FDI. If the current pattern of funding continues, then we can't give any projects to the people. The ongoing projects themselves will take anywhere between 30 and 50 years for completion. So, we have to identify the projects that are critical in the larger interests of the country, and deliver them.
Will you revise passenger fares and freight charges?
Certainly; that is the need of the hour. Mallikarjuna Kharge, in the interim budget, proposed a hike of 5 % in freight and 10 % in passenger fares. He presented the Budget factoring in these revised tariffs, but did not implement them. Now I am forced to do something because of the present situation of the Railways. I will now discuss with the finance ministry on the funding support.
What about the projects announced in the interim Budget?
We don't want to ignore them. But at the same time, our approach is to complete important projects within a reasonable period of time.
Can we expect some announcement on the Diamond Quadrilateral in the Budget?
It is an important idea that we have in our mind. We need to have high-speed trains, and we are working on how to get funding for these projects: whether to go for publicprivate partnerships (PPPs) or FDI or raising funds through bonds. At this juncture, I can't discuss much on this. We will have to see how much resource is going to be available from the finance ministry. I will meet the finance minister in the next two days.
How will you increase the role of the pri vate sector?
I am working with some private sector players, who are interested in investing money in the Railways for the construction of infrastructure like godowns, freight corridor etc. The coal ministry has agreed to provide funds for the construction of special coal corridors. At another level, I have discussed with Rural Development Minister Nitin Gadkari to extend MGNREGA for railway projects. We can make use of the scheme in projects involving earth work.
Where do you stand on Railway modernisation?
Private players have shown interest in railway developmental work. In fact, I need to start work on modernisation from my own office. I want to see all tendering process converted into e-tendering and digitise the Rail Bhavan.
You talked of forming an expert group to advise you... Yes. I have already had one round of talks with E Sreedharan. After presenting the Budget, I will have a team of youngsters from IITs and IIMs to provide us inputs and fresh ideas.
Railways badly needs the latest technology, and innovation.
Many CMs have high expectations from your ministry. How will you deal with them?
The chief ministers of Odisha, Karnataka and Goa have met me. The Railways has a costsharing arrangement with a few states like Karnataka and Andhra Pradesh. The state provides free land and bears half of the project cost. I have written to all chief ministers and urged them to contribute their share to Railway development in their respective states. I gave them the example of Karnataka and said that other states too should contribute similarly. Of course, it is another matter when Siddaramaiah met me recently.He said that the state can't take the burden anymore.
If a state can't share the burden, it will be the loser.
Tamil Nadu CM Jayalalithaa is pressing for setting up Cauvery Management Board.
As a minister from Karnataka, how will you deal with this?
It is but natural for a chief minister to fight for the interests of his or her state. Jayalalithaa going to the prime minister to discuss the Cauvery issue is not something new. But what decision the Centre will take is important. The matter is pending before the Supreme Court, and is expected to come up for hearing in the third or fourth week of July. Hence, the Centre need not interfere at this juncture. We have requested the prime minister to get a legal opinion, and have also told him that before we take a decision, we must discuss with Karnataka. The prime minister has agreed.
Politicising this issue will not help. And you know the attitude of Jayalalithaa.
How do you see the performance of the Siddaramaiah regime in Karnataka?
Siddaramaiah has been functioning like a dictator. He is an one-man army. He wants to have his way, and not bothered about the implementation of his government's decisions.
People have begun to compare the development during the BJP rule with that under Siddaramaiah. The Congress leaders are busy fighting. We are actually gearing up for elections which may come any time if you see these internal fights. Jayalalithaa going to the PM to discuss the Cauvery issue is not something new. But what decision the Centre will take is important. The matter is pending before the SC.... Hence, the Centre need not interfere at this juncture. We have requested the PM to seek legal opinion, and have told him that before we take a decision, we must discuss with Karnataka... Politicising this issue will not help. And you know the attitude of Jayalalithaa.
ON JAYA POLITICISING CAUVERY ISSUE Siddaramaiah has been functioning like a dictator. He is an one-man army. He wants to have his way and is not bothered about the implementation of his govt's decisions... The Congress leaders have been busy fighting. We are actually gearing up for elections which may come up any time if you see these internal fights going on.
ON SIDDARAMAIAH'S FUNCTIONING
We will be focusing on factors of safety, security and service. If we are able to implement these three successfully, then speed will be the fourth aspect we will be looking at.
But Railway finances are in a shambles...
Yes, resources are a big issue. Some ministers in the past looked at announcing new projects without bothering about their actual delivery. They did not see if resources were available to implement them. We have some ` .5 lakh crore (. ` 5 trillion) worth of projects, announced by earlier regimes, on ground. But the ministry gets only about ` . 25,000 to . 30,000 crore by way of net revenue. There ` is a grave mismatch between income and expenditure. Some ongoing projects in Southern and South Western Railways will take about 45 to 50 years to complete. This is because, in the past, if a project worth ` . 1,000 crore was announced, only about ` . 10-15 crore was earmarked by way of token allocation. And as we delay on projects, costs go up.
How can we deliver projects if this is the situation?
So, how will you deal with it?
In the past, the ministry never looked at new avenues for resources like PPP or FDI. If the current pattern of funding continues, then we can't give any projects to the people. The ongoing projects themselves will take anywhere between 30 and 50 years for completion. So, we have to identify the projects that are critical in the larger interests of the country, and deliver them.
Will you revise passenger fares and freight charges?
Certainly; that is the need of the hour. Mallikarjuna Kharge, in the interim budget, proposed a hike of 5 % in freight and 10 % in passenger fares. He presented the Budget factoring in these revised tariffs, but did not implement them. Now I am forced to do something because of the present situation of the Railways. I will now discuss with the finance ministry on the funding support.
What about the projects announced in the interim Budget?
We don't want to ignore them. But at the same time, our approach is to complete important projects within a reasonable period of time.
Can we expect some announcement on the Diamond Quadrilateral in the Budget?
It is an important idea that we have in our mind. We need to have high-speed trains, and we are working on how to get funding for these projects: whether to go for publicprivate partnerships (PPPs) or FDI or raising funds through bonds. At this juncture, I can't discuss much on this. We will have to see how much resource is going to be available from the finance ministry. I will meet the finance minister in the next two days.
How will you increase the role of the pri vate sector?
I am working with some private sector players, who are interested in investing money in the Railways for the construction of infrastructure like godowns, freight corridor etc. The coal ministry has agreed to provide funds for the construction of special coal corridors. At another level, I have discussed with Rural Development Minister Nitin Gadkari to extend MGNREGA for railway projects. We can make use of the scheme in projects involving earth work.
Where do you stand on Railway modernisation?
Private players have shown interest in railway developmental work. In fact, I need to start work on modernisation from my own office. I want to see all tendering process converted into e-tendering and digitise the Rail Bhavan.
You talked of forming an expert group to advise you... Yes. I have already had one round of talks with E Sreedharan. After presenting the Budget, I will have a team of youngsters from IITs and IIMs to provide us inputs and fresh ideas.
Railways badly needs the latest technology, and innovation.
Many CMs have high expectations from your ministry. How will you deal with them?
The chief ministers of Odisha, Karnataka and Goa have met me. The Railways has a costsharing arrangement with a few states like Karnataka and Andhra Pradesh. The state provides free land and bears half of the project cost. I have written to all chief ministers and urged them to contribute their share to Railway development in their respective states. I gave them the example of Karnataka and said that other states too should contribute similarly. Of course, it is another matter when Siddaramaiah met me recently.He said that the state can't take the burden anymore.
If a state can't share the burden, it will be the loser.
Tamil Nadu CM Jayalalithaa is pressing for setting up Cauvery Management Board.
As a minister from Karnataka, how will you deal with this?
It is but natural for a chief minister to fight for the interests of his or her state. Jayalalithaa going to the prime minister to discuss the Cauvery issue is not something new. But what decision the Centre will take is important. The matter is pending before the Supreme Court, and is expected to come up for hearing in the third or fourth week of July. Hence, the Centre need not interfere at this juncture. We have requested the prime minister to get a legal opinion, and have also told him that before we take a decision, we must discuss with Karnataka. The prime minister has agreed.
Politicising this issue will not help. And you know the attitude of Jayalalithaa.
How do you see the performance of the Siddaramaiah regime in Karnataka?
Siddaramaiah has been functioning like a dictator. He is an one-man army. He wants to have his way, and not bothered about the implementation of his government's decisions.
People have begun to compare the development during the BJP rule with that under Siddaramaiah. The Congress leaders are busy fighting. We are actually gearing up for elections which may come any time if you see these internal fights. Jayalalithaa going to the PM to discuss the Cauvery issue is not something new. But what decision the Centre will take is important. The matter is pending before the SC.... Hence, the Centre need not interfere at this juncture. We have requested the PM to seek legal opinion, and have told him that before we take a decision, we must discuss with Karnataka... Politicising this issue will not help. And you know the attitude of Jayalalithaa.
ON JAYA POLITICISING CAUVERY ISSUE Siddaramaiah has been functioning like a dictator. He is an one-man army. He wants to have his way and is not bothered about the implementation of his govt's decisions... The Congress leaders have been busy fighting. We are actually gearing up for elections which may come up any time if you see these internal fights going on.
ON SIDDARAMAIAH'S FUNCTIONING
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