Financial Express, Last Published: September 21, 2015
Indian Railways’ initiatives to become more customer-focused are on the right track
Indian Railways has come a long way since the time of steam engines. Connectivity between Delhi and Mumbai through a high-speed bullet train is no longer a pipe dream, but an imminent prospect.
There has been a fair amount of criticism about the slow pace of progress in the Railways, even though there has been tangible progress under the new regime. Key steps taken by the ministry under the leadership of railway minister Suresh Prabhu are evident of the ongoing commitment to achieve operational excellence in one of the world’s largest and oldest rail networks.
To begin with, Indian Railways has considerably improved its operating performance in the current year—this is the first time in the last 7 years that Indian Railways’ operating ratio (the amount it spends to earn a rupee) has been healthier than what had been budgeted. It currently stands at 91.3% over the budget target of 92.5%.
Robust monitoring & reporting mechanism: It is particularly encouraging to note key changes brought about by the minister to bolster Indian Railways’ operating performance—this includes constituting an unprecedented Quarterly Performance Review for the Railways, akin to private firms. The ministry also has begun monitoring progress on budget announcements every 15 days via an online portal called ‘eSamiksha’—this has brought about a welcome sense of urgency and accountability across ranks of the organisation.
Boosting public private partnership (PPP): The success of PPP has reaped rich benefits in other infrastructure sectors, and the same must be replicated in the Railways on a large scale. Over the next four years, PPPs are expected to contribute R1 lakh crore of investment into the sector. This will also bring in innovative financing mechanisms in areas like redevelopment of stations (the Cabinet has approved the development of over 400 stations via PPP); electrification and signalling; construction of freight lines and elevated corridors; and port and mine connectivity projects. These can be effectively structured into EPC or BOT projects for best results. The ministry is pursuing these avenues in a significant way and, given the scope of these projects, there certainly will be large companies lining up to take part in this growth opportunity.
The game-changer—dedicated freight corridors: The implementation of DFCs will be a game-changer for India’s freight transportation market with the Railways reclaiming the leading role in this sector. This will create 3,300 km of additional high-capacity lines, ease congestion from the existing network and give an impetus to Make-in-India in the industrial corridors coming along DFCs. The ministry is working on a war-footing to actualise the targets; 85% of land has been acquired for DFCs, R16,975 crore of commitments have been made since November 2014 (as compared to R10,401 crore since the inception of the scheme) and the first section of 56 km of the DFC is set to be opened for traffic on schedule.
Benchmarking to international standards: Another commendable move is the proposed technological collaboration with foreign railways for development of world-class terminals and stations. The ministry is working with World Bank experts to benchmark operational efficiencies with global best practices, and top consultants are being engaged to undertake a study on current operational practices. These indicate a willingness to change and adopt latest technology on part of the ministry, which will percolate down the ranks.
Improving customer experience: Issues ranging from cleanliness of platforms and trains to the difficulty in procuring tickets have been pain points for the vast majority of passengers for long. There now is a visible difference in terms of cleanliness at stations and trains, in line with the Swachh Bharat vision. A new department has been created and given charge of train and station cleanliness. In terms of ticketing, a number of measures have been introduced like mobile paperless ticketing at metro and suburban areas and ticket vending machines. The IRCTC website and apps have been revamped to handle increased ticketing load and made more user-friendly and robust.
Superior riding comfort: Procurement of state-of-the-art train sets, which has been a long pending issue, has been addressed and proposals from leading global firms are under evaluation. This will bring in modern, world-class high-speed trains which can be deployed on overnight routes to attract airline passengers. Plans are to have these train sets manufactured locally promote Make-in-India. The National Institute of Design has been roped in to provide expert inputs for improving coach interiors as well as external branding. There is a plan to engage IRCTC to transform railway retiring rooms into three-star facilities—this will be a big step forward in terms of upgrading customer amenities.
These initiatives, supplemented by the strategic policy reforms announced earlier this year, including the recent MoU with LIC to tie up funding worth R1.5 lakh crore, establishment of the financing cell along with banks and, most recently, the railway user outreach programme—Railyatri/Upbhokta Pakhwada—are the measures to make Indian Railways more customer-focused.
-By Rana Kapoor , president, Assocham, and MD & CEO, YES Bank