Ideas on How to Raise Money for Indian Railway to Provide Better Services.

If you are a traveler, railway enthusiast, doing your research on railways or just love to read about social topics then this is the article for you. In this article, I mentioned some solutions to improve Indian Railways service quality, Its problems, and ideas on how it can raise money to generate more profits.

OVERVIEW

Indian Railways occupies a unique position in the socio-economic map of the country. The railways are considered a vehicle of growth contributing to rapid industrial and infrastructural development of the country. However, in the process, Railways tend to subsidize and nourish the economy by incurring a social cost, much beyond the normal call of any transport system. This constrains Railways ability to spend generously on enhancing the customer experience and hence in this project proposal, I’m going to specify the number of solutions to generate revenue, reduce expenditure and other related factors along with each decision mentioned in this article with and without an increase in direct ticket and/or service prices of the Railways. The proposed ideas in this article are based on user feedback provided on social media platforms like Twitter, Quora, Google…etc.

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GOALS

  1. Reduce Expenditure and losses.
  2. Generate/Raise Money.
  3. Make railways more profit turning.
  4. Improvement in user experience.

ANALYSIS

CURRENT SCENARIO

According to Indian Railway final figures for Earnings and Expenses of Railway are as under:

 

2012-13

2013-14

2014-15

2015-16

2016-17

Gross Revenue

126180

143214

161017

164333

165292

Working Expenses

112565

131465

144179

147836

159030

Net

13615

11749

16839

16497

6262

The provisional figures for 2016-17 and trends for 2017-18 are showing stagnation in Gross Revenue. It is evident from these figures that Revenues of Indian Railways are not growing matching the potential, considering the increasing demand for transportation services due to Economic Growth.

The main sources of Revenue for Railways are Freight, Passenger Services including Suburban and Kolkata Metro, Parcels etc. These sources are showing signs of stagnation mainly due to saturation of existing network, and the work to expand the network is in progress. However, expansion of the network is a time-consuming process. As and when this expanded network becomes available, the Railways will have to apply innovative ideas to fully utilize this expanded network. So, the challenge before the Railways is to increase its revenue in short to medium term from Non- Fare sources and other sources which are network independent and in the long term generate revenues from conventional sources which aim at the utilization of the expanded network. There is also a huge scope for raising revenue from Non- Fare revenue sources.

Normally, Revenue can be increased in one of the following ways:

  • Increase the number/quantum of services
  • Increase rate of recovery per unit of transportation
  • Plug leakages of revenue

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To provide some solutions to increase Indian railways revenue, I did some research and found some fact which I summarised into following points for my readers.

  1. Recruit more TTEs or Introduce fixed entry points to platforms like in Airports to increase revenue from current users of railways.

Currently, a lot of people travel without a ticket in India. However, it is not really possible to catch all of them because of less number of TTEs in stations. Even if 90% people travel with the ticket, then IR could increase revenue in crores. Cover the entire station like metros or with truss work and restrict entry-exit through multiple fixed points. Introduce scanner machines in all those entry and exit points. Recently I visited Nagpur station, there was a scanner machine at one point and 20 meters away was the entry point. Most of the passengers didn’t bother scanning their luggage. The railway can also introduce checking platform tickets or traveling tickets at the entry points. This will reduce the rush in platforms (seeing off mess can be reduced), increase revenue with platform tickets and also help us avoid incidents like the terrorist attacks. It will also reduce work for TTE.

  1. Improved user facilities.

Currently, there are a number of customer care contact numbers for different operations, complaints, help…etc. If it is feasible for operation and user convenience then make it a single number contact system. It will surely reduce operational cost and give users a central system. Better and cleaner toilets, better maintenance of trains. Use plastic tokens or digital tickets to reduce usage of paper tickets.

Areas of Improvement

1)  Cleanliness on train, station, and rail tracks.

2)  Providing security to passengers and their belongings.

3)  Improvement in on train food and water quality.

4)  On Estimated time arrival and departure of trains.

5)  Provision of an electronic notice board in each compartment of the train to show upcoming stoppage station with expected time, upcoming non-stoppage station, the current time.

The logic behind this point is that if the user experience gets improved then automatically profit will get increased.

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  1. Social Services – A financial burden.

Railways bear social service obligation of around Rs 25,000 crore every year. This is done by carrying passenger and goods services below cost. Net Social Service Obligation borne by IR in 2013-14 is assessed at Rs 21,391 crore. There is a total of 53 different categories for whom concessions are provided by Indian Railways. Astringent relook into the same should be done. Plus concessions to people working in the IRs and their dependents must be stopped or reduced to some limit.

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  1. Cancel trains with low occupancy, curtail halt timings to increase punctuality and reduce losses and use Multiple-unit Trains.

According to Indian Express, the cost of a train stoppage ranges from Rs 12,716 to Rs 24,506. As per the standard rules, any new stoppage should be able to recover the cost. surely this move of curtailing halting time will reduce revenue losses for time being but if new technology is applied to IR then it will be a lifelong solution and surely reduce losses on train stoppage and increase punctuality.

e.g. At present IR locomotives are powerful, faster, efficient than ever, but… A locomotive or two in the front, dragging a line of passenger coaches/compartments is an old technology followed till date. Many countries do not use this tech anymore. Instead, use ‘Train Sets’ or simply speaking ‘Multiple-unit Trains’. Like DMU or EMU trains that run without a locomotive, these ‘Train Sets’ also have independent traction motors for each bogie underneath every compartment that move the train on one synchronous go.

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Advantages of Multiple-unit Trains.

Acceleration is a crucial influencing factor in making a train slow. In IR, average stoppage count for a normal train per kilometer on an international relative scale is very high (Top reason: High number of stations; Other reasons: heavy traffic, speed restriction, lack of empty platform etc)

Once stopped, Trains take a lot of time to accelerate and attain needed speed — which consumes a considerable amount of time (this is because the entire load is thrust forward by a single locomotive). But, this is not the same with ‘Train Sets’

All coaches of a train-set accelerate at once, which allow them to reach their top speed in a very small time-span

IR’s current trains take a lot of time to stop after brake application. Even after braking, trains travel a significant distance before the halt. Current trains use air-brakes or vacuum-brakes, where a long pipe (that typically starts at a locomotive) is connected till the very end. When pilot applies the brake, it takes a lot of time for the end compartment to stop (this is because of the time lag). Passengers suddenly feel an annoying uncomfortable jerk. An electro-pneumatic braking system of train-sets cut the halt time by more than half (sometimes to 1/4th).

Train-sets/Multiple-unit technology is energy efficient in comparison to regular loco based units. Using these IR can save a lot of energy which in turn will save money for IR. They use traction motor based propulsion under every coach which eliminates the need for a bulky-heavy-locomotive and generator car. This elimination further reduces the overall weight — Thus, increased energy efficiency.

Aerodynamic design lets them use 25% less energy compared to normal trains.

Even under frequent braking conditions, Regenerative braking helps and allows save 17–25% energy.

As these trains stop fast (thanks to Electro-pneumatic braking system), any tragedy or mishap during emergencies can be averted/minimized. Automatic door closing systems make the ride safe for passengers. and Microprocessor based diagnostic and monitoring systems identify and indicate the electro-mechanical faults within no time.

These trains cost almost the same in terms of maintenance as regular trains. These trains benefit the passenger for sure, alongside they can make positive monetary returns for IR.

Unlike Bullet Trains, These train-sets are not at all very expensive

Almost all European countries use these kinds of trains (as both passenger and Intercity trains).

In India, they can surely benefit normal trains, alongside they can also help premium trains like Gatimaan, Tejas, Shatabdi, Rajdhani reach average speeds of 200 km/h (without changing any existing track layouts and conditions)

They don’t need any new type of coaches. As current LHB coach designs can easily withstand 200 km/h, the only kink is redesigning the compartments such that the propulsion system fits beneath the coaches.

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  1. Indian Railway could make each Railway Station a profit center by giving quarterly and annual targets to Station Master/ Manager/ Superintendent.

This will ensure that a Station Manager/Master/ Superintendent is not merely an Admin Head / Maintenance Head. He/She is also responsible for making it a profitable business.

Utilize the huge land parcels near the railway tracks to install solar panels to generate power and utilize this power for Electric Engine.

Hotels can be built over the space available above Railway Station buildings. The space above railway station can also be utilized to open Shopping complex / Mall / Restaurants/Kiosks for Hotels/Taxi/Travel etc. Of course, high-quality soundproofing will be required for all this.

Discourage passengers from carrying heavy baggage in the passenger coach. The baggage above the limit to be booked in cargo the way it is done in Air Travel. Baggage above free-limit could be charged without fail.

Create a position for Train Manager and make him responsible for complete business operations of the train. He should travel on the train and should be held responsible for customer complaints. His Key Responsibilities should be to ensure maximum occupancy of seats, no revenue leakage (no invalid passengers), no passengers beyond the capacity of the coach, safety & security of passengers and railway assets, 100% customer satisfaction on the service quality, housekeeping, sanitation etc.

All visitors should be charged to enter the railway station premises and these charges should be justifiable because they will use the facilities of the Station and also it should act as a deterrent to using the facilities free of cost.

IR must create reward/ penalty based target system for its employees on every quarter or year basis with profit target, ticket sell target, advertisements revenue target…etc fixed for each station.

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  1. Indian Railway could start Paid High-Speed WiFi service on most of the trains and stations.

IR already started wifi service with the help of Google on few stations and on few trains but if optional commercialization of this service is done then it could be a great source of revenue for IR. When a customer purchases the journey ticket online or offline, at that time IR can provide an option to opt-in for High-Speed wifi service with password and id generation at the time of ticket booking itself  printing it on the ticket and activating that password and id for the journey duration plus some time adjusting the delay in travel time. This method will provide IR’s users a great service to work or enjoy during journey and IR a new way of revenue generation. And as the service is optional if the user doesn’t want to spend extra money then he/she can save his/her money by not choosing for this service.

  1. Indian Railway could generate revenue by advertisements.

Station(TV screen/ Audio/ Poster) advertisements, inside train advertisements, outside train advertisements, sponsorship of railway personnel uniforms, advertisements on the backside of tickets,  advertisements on railway website and App, Railway station waiting room advertisements, sponsoring individual trains could be some ways to increase railways revenue.

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  1. Indian Railway could partnership with global, national and local food chain or food suppliers and selling rights to sell their product on train and station.

Instead of IR offering food in its pantry service or on the stations, IR can tie up with food and cold drink suppliers for pantry and food service providers. This will reduce burdens of supplying food and service to passengers and IR could focus on improving actual journey experience. This method should also generate revenues from the tie-up or by lending land to those food providers…etc.

As of now, many people enter into the train on one station to sell their product then they board some train without a ticket and sell their products to passengers. IR could assign the duty to station master or regional head to sell ‘Right to Sell Products on Train/Station’ this will increase revenue for IR and facilities for passengers.

The same could be done for product sellers other than food and cold drinks sellers like magazine sellers, Newspaper sellers…etc.

IR could also partner with Taxi/ Cab and hotel providers all over India.

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  1. Indian Railway should charge parking charges to local taxi/ cab drivers parked in its parking land with some minimal monthly charge. IR should also lend its unused land to interested parties.

 

  1. Indian Railway should introduce dynamic ticket pricing system just like Air-Travel system with prices changing according to route, date, season, time…etc.

 

  1. Indian Railway could use the solar panel on stations and some trains.

This move is already applied by IR on trial basis and if implemented on large scale will surely reduce IR’s electricity cost by a large extent.

  1. Indian Railway could make shorter and faster trains.

For example, let’s say Geetanjali Express is a 24 coach train that runs between Howrah and Mumbai. It leaves Howrah at 3 pm. Now if IR creates two trains to Mumbai of 15 Coaches every day once in morning and once in evening, then IR makes it easy to increase the speed of the train as well as we are increasing the capacity. This, in turn, will improve punctuality and revenue of railways.

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  1. Indian Railway could upgrade the coupling system and coaches with the new LHB coaches.

The present coupling system IR is using is age-old, started by the British in the 19th century with little or no modification. Now the railway can replace this Coupling System with new modern ones which will allow the railway to improve speeds of its trains. Although the up-gradation to modern LHB coaches is already being done in some cases which have a better suspension system.

Well, this is the end of this article on Indian Railway, current scenario of Indian Railway & few solutions on few problems it is facing right now. Of course, Indian Railway is already trying some of above solutions on the small-scale trial basis. But IR needs to adopt favorable solutions without wasting much time. And to do that along with money it needs political will.

 

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