Railway Budget 2015: Industry lauds Prabhu for reform-oriented, pro-growth steps

New Delhi: Terming the Rail Budget as "pragmatic", India Inc today welcomed the larger role envisaged for the private sector and said various measures proposed would bring in higher efficiency and improve ease of doing business.

Adi Godrej, Chairman Godrej group, praised the budget for `a number of innovative measures to increase revenue'. He said, the road map laid for attracting private investment for the sector through tapping low cost long-term funds from insurance and pension funds, multi-lateral and bilateral agencies; forming JVs with IRFC or existing NBFC of a PSU; creating new vehicles like a holding company to raise long-term debt to induce investment will go a long way in boosting the cash strapped sector and facilitate completion of many crucial rail project."

The pro-tourism focus of the maiden Railway Budget by the Modi government is a strategic combination of connectivity, safety and modernisation-technology bringing the spotlight back to Destination India, said Madhavan Menon, MD, Thomas Cook India. "The enhanced customer experience augurs well from both an inbound and domestic perspective. Connectivity to Kashmir and North Eastern states immediately puts them back on the tourist radar and Rs.2000 cr for Coastal Connectivity Program will reinforce the focus on tourism in South India as well. We are delighted with the announcement of 77 new projects ;including both High and Semi-High Speed initiatives, also the enhanced road-rail connectivity & infrastructure to key tourist locations. We applaud the unique and strategic initiatives like offering coaches in select trains connecting major tourist hubs to travel agencies on a revenue share basis; a “Gandhi Circuit” to attract tourists celebrating the centenary 100 year Gandhiji’s return from South Africa; an “ Incredible Rail for Incredible India” program to train auto-rickshaw and taxi-operators as tourist-guides to promote tourism. ”

Sunil Kant Munjal, Joint Md, Hero MotoCorp said that "by initiating measures to improve the operational efficiency of railways as also introducing innovative financial mechanisms- such as engagement of pension funds and other long term debt instruments, engagement with states, using funding under MPLADs, funding of bilateral and multilateral organisations, joint ventures, PSUs etc - to modernize the decrepit rail infrastructure, the Rail Budget has sought to improve the competitiveness of this means of mass transport. Similarly by making an attempt at resource mobilization by strengthening of PPPs and through acquisition of new technologies, the Minister has attempted to effect a much anticipated turnaround in rail operations. A revamping of PPP cell to protect the interests of the private sector, comprehensive policy for tapping the latent advertisement potential, digital mapping of land records, policy for utilization of rail land, creation of rail research centres, among others  are the other break-through ideas for the rail sector. This would lead to greater efficiency and result in the railways being the preferred mode of transport for passengers as well as for goods."

Ravi Uppal,  MD &Group CEO, Jindal Steel Power Ltd. said,  “A comprehensive and visionary budget that could revitalize the railways and resolve many of its core issues including financial health and put it back on track. The budget lacks in fine detail but promises a superior ride to everyone from passengers to private participants with a slew of measures aimed at improving operational efficiencies and invigorating the PPP model and nodal agencies. On the downside the 6.30 per cent hike in freight rates for coal will dent a range of industries and is also out of whack with the Make in India spirit. Along with the 0.8 per cent hike in steel freight this is a double whammy that could have been avoided”.

"The Rail Budget would improve ease of doing business and improve connectivity of the manufacturing units with the ports and air connectivity. It would certainly in the long run remove bottlenecks in the key infrastructure for reducing cost of manufacturing in India," engineering exporters body EEPC India chairman Anupam Shah said.

 Railway Budget 2015: Industry lauds Prabhu for reform-oriented, pro-growth steps

Union Railway Minister Suresh Prabhu. Image courtesy PIB

"The initiatives like larger role of the private sector in station upgradation, rolling stock and bulk transportation would go a long way in making the railways efficient. Besides, enhancing train speed both for passenger and freight segment would bring in higher efficiency and improve ease of doing business," Assocham president Rana Kapoor said.`

Railways Minister Suresh Prabhu did not hike passenger fares in the Budget presented today.

The minister hiked the freight rate for cement, coal, others by up to 10 percent; while envisaging investment of Rs 8.50 lakh crore in five years and proposed 77 new projects covering 9,400 km of doubling works, among others.

Besides, Prabhu announced a slew of measures for passengers including buttons and coin vending machines for railway tickets, e-catering to select meals from an array of choices, 24X7 helpline for passenger security issues and surveillance cameras in suburban coaches for women safety.

"Big increase in the Plan size of over Rs 1 lakh crore would lead to a positive impact on other sectors related with the Railways. The Budget shows that for the first time the government has started treating the Railways as a commercial enterprise without using it as a political vehicle," he added.

"Rather than taking up long-term goals he has talked about a lot of short term plans which are more achievable. The budget is aggressive and ambitious in nature," president & CEO at GE Transportation Nalin Jain said.

"The Rail Minister has today placed very positive and honest budget. After taking a stalk of what he has presented, we, the industry has reasons to feel bullish," CMD of TIL Ltd Sumit Muzumder said.

"This is a very positive budget that can build momentum for significantly reformed Railways in the years to come," GV Subrahmanyam," Partner at Grant Thornton India LLP said.

"For building track capacity Railways have a scheme where people can come and say I will build, operate and transfer (BOT) this particular section of the track. This was never open to the private investors. Now this area has been opened," MD of Rail Operations Hind Terminals LR Thapar said.

"The Railway Minister should have set some rules by which fare increases...This was the time to initiate a process by which fares will change over a period of time. Similarly for freight, we have seen that freight rates and passenger fares have not been touched. But the fact of the matter is they have been touched earlier," Sharat Mishra, Association of Container Train Operations, said.

Lauding the railways minister for taking care of all the stakeholders, Siemens, VP- Mobility, Tilakraj Seth said, "The plans are very credible and he has taken care about all. The budget today was an honest attempt. It is more a business like budget and taken steps that are need of the hour."

He added, "The nature of the budget was good in a sense that it talked about four big goals which include enhancing customer experience, ensuring safety of passengers and increasing capacity."

Larsen and Tubro chief executive Rajeev Jyoti said: "The minister has taken up innovative measures of finance generation. He is talking about a lot of things including pension funds, MP LAD funds and state level joint ventures, I think there is a creativity element in the way he has talked about raising money."

"A major thing that he announced today is the independent regulator is to be brought in to ensure that the private sector investment is protected and encouraged," said Titagarh Wagons, VC & MD, Umesh Choudhury.

Terming the Rail Budget as a 'treat to hear' Choudhury said, "The minister has presented a very comprehensive roadmap for the railways focussing on the next five years. I really can't see any point which he failed to address and the challenge is how quickly he can put this into action."

PTI

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Updated Date: Feb 27, 2015 12:52:05 IST