Railways hikes freight rates, removes flexi fares from 15 trains - watsupptoday.com
Railways hikes freight rates, removes flexi fares from 15 trains
Posted 01 Nov 2018 12:27 PM

Agencies
Railways increased freight rates by 8.75 per cent for carrying major commodities like coal, iron ore, steel and some smaller goods Wednesday. It also announced a downward revision in “flexi fare” system for premium passenger trains, with Railway Minister Piyush Goyal calling the move a “Diwali gift to passengers”.

Rising diesel prices made Railways spend around Rs 2200 crore extra since April on fuel — an amount that was beginning to weigh on its operating finances, sources said. Railway Board had started discussing the fact that diesel prices had made the road sector jack up its rates. “So there was clearly some scope to increase our freight rates without losing our price advantage vis-a-vis the road sector,” a senior Railway ministry official said.

Foodgrains, fertilisers, petroleum products and cement have been left out of the hike.

A statement from the ministry said the hike was “to improve passenger amenities”. Railways expects to earn Rs 3,344 crore in a year from this.

The announcement came on a day when after months of internal deliberations, Railways proposed to revise the flexi fare system from many premium trains owing to low occupancy.

The Indian Express had in August reported about the move, which has been in the making for months.

The upper limit of increase under the revised system will be 1.4 times of the base fare, instead of the current 1.5 times. Also, for trains in which occupancy figures are lower than 60 per cent four days prior to date of departure, Railways will offer 20 per cent discount on the last booked fare under flexi system. If occupancy reaches 70 per cent, there will be a 10 per cent discount and if the occupancy is between 70 and 80 per cent, there will be a 10 per cent discount. This new graded discount is to “increase the occupancy of less patronised classes”, the ministry stated.

Some officials claimed that while the flexi fare revision was on cards, the hike in freight rates will compensate any possible revenue loss from the exercise.

Fifteen trains, mostly Shatabdis and two Durontos, whose average monthly occupancy in the last financial year was less than 50 per cent, will no longer have flexi fare. Another 32, whose average monthly occupancy in the last fiscal was between 50 and 75 per cent, will not have flexi fare during the lean months of February, March and August.

“As a gift to passengers this festive season, Railways has decided to reduce flexi fares from 1.5 to 1.4 times the base ticket fare, and to completely remove flexi fares from trains with less than 50 per cent occupancy,” Goyal tweeted.

The changes in flexi fares will be implemented from Advance Reservation Period, which is four months, after modifications in the Passenger Reservation System software. The changes will be made on an experimental basis for six months, to be further extended after assessing the outcome, Railways said.

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