The interim rail budget 2009-10 presented to the Parliament by Union Minister for Railways Lalu Prasad on Friday brought cheer to millions of train passengers across the country, but failed to impress opposition parties that said the package was a ‘bogey’ geared towards poll stations.
The budget cuts fares by 2 percent, introduces 43 new routes and ups the planned expenditure for expansion, despite a clear downturn on freight revenues during the last quarter.
Humour, spontaneous digs at the opposition and gallery play were the highlights of the Lalu’s budget speech. He also announced the extension of 14 routes, an increase in the frequency of 14 trains and additional expenditures to be incurred on safety.
In his fifth straight rail budget for the UPA government, Lalu earmarked a higher plan expenditure of Rs.37,905 crore (Rs.379.05 billion/$7.58 billion) towards expansion next fiscal, against revised estimates of Rs.36,773 crore (Rs.367.73 billion/$7.35 billion) for 2008-09, hoping for higher passenger and freight earnings since January.
The minister is known to have turned around the railways into a profit making arm for the central establishment.
He also reported higher earnings on both passenger and freight segments, despite the economic slowdown.
Lalu expressed pride that the Railways took the tracks to recovery under him and expressed hope that the journey to the zenith of success would continue without taxing the proverbial ‘aam admi.’
Lalu’s measures, however, are interim in nature, as the regular budget would be presented by the new government on the other side of the general elections slated for later this year.
The Indian Railways are the second largest railroad in the world under a single management, running more than 11,000 trains every day, 7,000 of which are for passengers.
The network comprises 108,706 km and ferries 14 million passengers daily from 6,853 stations across the length and breadth of the country. This is the reason why it is the only ministry that has a separate budget.
Indian industry welcomed the budget, especially the decision to enhance the capacity of wagons and the push for dedicated freight corridors across the length and breadth of the country.
The Confederation of Indian Industry (CII) said: “Freight corridors, containers and improved passenger amenities announced in the budget will go a long way in making India’s railway network more modern and efficient.”
The Associated Chambers of Commerce and Industry (Assocham), though, said the budget could have lowered freight rates as well.
FICCI said Lalu had failed to come to the rescue of the industry by lowering freight charges at a time when the industry is battling with a grave economic slowdown.
With an eye towatds to looming general elections Lalu, who had recently visited Japan and rode the famous ‘Shinkansen,’ said his ministry was examining the feasibility of running the “bullet trains” on the Delhi-Patna sector.
Soon after the session the UPA principal – Congress – said the budget was “pro people” and “developmental.
However, Lalu’s exuberance and humour failed to rub off on the opposition benches where leaders cutting across the spectrum blasted his budget as “populist” – a four letter word in democratic India.
Former rail minister and Trinamool chief Mamata Banerjee says the budget was a “mere poll gimmick” that would lose all relevance after a new government takes over.
The main Opposition Bharatiya Janata Party (BJP) said the interim document was “disappointing, directionless and populist.”
Party spokesman Shahnawaz Hussain said the budget was nothing “but jugglery of words.”
Despite criticism from opposition parties Lalu found reprieve in soaring market indexes that took his budget as a pointer towards the interim general budget to be presented Monday, to shed pessimism.
The BSE index ended up 1.78%, after having risen as much as 2.4% during trade while the 50-share NSE Nifty index rose 1.9% to notch its highest close since January in over a month.
Optimism prevailed after the budget was announced and analysts expressed optimism of the government announcing financial stimulus to revive slowing growth in the interim Budget 2009-10 that is scheduled to be tabled in Parliament on Monday.