Lalu Prasad weaves magic with 5th annual railway budget
Union Railway Minister Lalu Prasad Yadav struck the right chord with 1 billion-plus people of India, Tuesday, by unveiling the 5th annual Railway Budget that included cuts in passenger fares and freight rates and ambitious plans to modernize the rail infrastructure.
Unveiling the populist budget in the Lok Sabha (Lower House of the Indian Parliament), Lalu Prasad informed that the railways had a record cash surplus of Rs.25,000 crore ($6.25 billion) for 2007-08, while the total cash surplus for the last four years stood at a whopping Rs.68,778 crore ($17.2 billion).
"The financial turnaround of the railways has been achieved by thinking beyond the beaten path, taking innovative decisions in commercial, operational and pricing policies and through cross-functional cooperation," Lalu Prasad said.
He said that the plan expenditure, which for the next fiscal is Rs.37,500 crore ($9.4 billion), will see more than 79 percent coming from internal accruals and extra-budgetary resources.
The plan outlay is about 21 percent higher compared to the current financial year and is the largest ever budgetary allocation in the history of railways.
Indian Railways proposes to raise Rs.81,900 crore ($20.5 billion) in revenues in the next fiscal beginning April against the expected revenue of Rs.72,755 crore ($18.2 billion) this financial year, Lalu Prasad said.
Of the proposed Rs.81,900 crore, railways will mop up Rs.52,700 crore ($13.2 billion) from freight, Rs.21,680 crore ($5.5 billion) from passenger fares and the rest from other sources.
The total targeted earnings will constitute 79 percent of the budget estimates proposed for the railways for 2008-09 and the gap of 21 percent will be met with a budgetary support of Rs.7874 crore ($1.97 billion) of which Rs.774 crore ($193.5 million) will come from the central road fund.
With a view to offset the concerns on inflation, Lalu Prasad announced a reduction of 5 percent in freight rates for petrol and diesel while proposing a 14 percent cut in freight rates for fly ash.
To ensure speedy development of North Eastern states, the railway minister announced a 6 percent cut in freight rates for transferring goods to the north-eastern region from other states.
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