The Railway Budget has been provided. Here’s a quick list (with press release links) for the major announcements:
New Stuff
- High speed rail between metros. But the budget is just Rs. 100 cr. So very unsure how this works.
- 9 sectors to have train speeds of 160 to 200 kmph. (Delhi to Agra/Chandigarh/Kanpur, Mumbai to Goa/Ahmedabad, Hyderabad-Chennai, Nagpur and Nagpur to Bilaspur)
- 58 new trains, 11 trains extended.
- Specially packaged trains for Pilgrim circuits
- New Ticket reservation system, move to paperless offices in 5 years.
- Real time tracking of trains, Navigation information system
- Railway connection to new and upcoming ports, through PPP. Now this makes sense, the port operator will pay.
Changes to Trains and Stations
- CCTV on trains, platforms, for security and cleanliness
- Bio-Toilets so that waste is not directly discarded on track. (Thank goodness)
- Food courts in stations (finally)
- Cleanliness budget up 40%
- Wifi in A and A1 category trains, workstations in trains.
- Logistics support to e-commerce companies by segregating pick up centers.
- Lifts and Escalators in stations, through PPP route. I don’t know how this works – do you pay to use the lift? Why PPP if the private player sees no revenue?
- Battery operated carts to transport the old and invalid.
Outsourcing and Private Party Participation
- Cleaning: Housekeeping to be contracted out at 50 major stations
- Food Courts in Stations
- Logistics support to e-commerce companies by segregating pick up centers.
- Bulk of future projects through Pulbic Private Participation (PPP)
- Cabinet approval required for FDI in Railways, has been asked for.
- E-Procurement will be purely online, including wagon requests and status of projects.
Where’s the money going to come from?
- They’ll earn 1.64 trillion (lakh crore) from ops. (Link)
- They’ll spend 1.49 trillion (lakh crore) (Link)
- Revision in prices based on the cost of fuel.
- They’ll borrow around 11,800 cr. which for their revenue isn’t that much. Plus, they might be able to raise it at lower costs through tax free bonds with IRFC.
Positive For?
- BEML which makes coaches.
- Many of the rail companies like Kalindee Rail, Texmaco Rail etc. but it looks like expectations were even higher!
- Based on the implementation, will be good for freight. Which probably means not so great for the likes of Ashok Leyland and Tata Motors which make trucks.
- All these stocks are down big time, some limit down. However, the impact isn’t negative at all, and FDI for Railways will most likely come through after the budget.