Railway accidents: Union Budget likely to propose Rs 1 lakh crore safety fund

India's Railways for long has been known to be the backbone of the country's transport system, but recent spate of accidents has once again shifted focus to the shortcomings in the safety department.

It is in this context that the government is looking to pump in funds over and above the budgeted allocation for undertaking the safety upgrades.

For this, the government is looking to float a special fund called Rashtriya Rail Sanraksha Kosh (RRSK), which will see Rs 1 lakh crore capital infusion to be spread over a five year period, The Indian Express report said.

 Railway accidents: Union Budget likely to propose Rs 1 lakh crore safety fund

Representational image. AFP

This likely capital infusion for safety upgrades will come after a gap of 16 years. Prior to this, the government had raised Rs 17,000 crore as special safety fund in 2001 when Nitish Kumar was at the railways ministry. Of the Rs 17,000 crore, the finance ministry then had approved Rs 12,000 crore and the balance Rs 5,000 crore came in through a levy of safety surcharge on passengers.

This year, the government has decided to club Railway budget with the Union Budget scheduled to be unveiled on 1 February. The finance ministry has already set aside Rs 55,000 crore as gross budgetary support for Railways for the next financial year 2017-18. For the safety fund, the first installment of Rs 20,000 crore will be paid from the budgeted amount, while the rest will be used for the normal capital expenditure.

However, the IE report suggests that of the Rs 55,000 crore earmarked for the railways, Rs 15,000 crore will go into special safety fund, while the remaining Rs 5,000 crore would be borne by the railways.

According to a report in Mint, Railways is looking at spending Rs 1.3 lakh crore as capital expenditure in the next financial year.

“The railway ministry has sought a gross budgetary support of Rs 60,000 crore from the Union budget and we are hopeful to get around Rs55,000 crore which is an increase of approximately 20%,” Mint repot said quoting a senior railway board official.

Last years PhillipCapital report said the country's Railways will require around $53 billion capital to undertake pending projects and network decongestion orders over FY17-FY20.

Updated Date: Jan 20, 2017 15:58:48 IST