Press Statement

The Polit Bureau of the Communist Party of India (Marxist) has issued the following statement:

Railway Budget 2001-2002

Populist Gimmicks: Future Additional Burdens Imminent

The railway budget for 2001-2002 has predictably been a populist one in view of the forthcoming assembly elections in some states, including West Bengal.

However, behind the veil of populism is a stated Rs. 500 crore burden through increased freight charges. While there is an average increase of 3 per cent on most commodities, the increase on coal, iron and steel is bound to impact on a large range of products and contribute to general inflation in the country.

The most serious aspect of the budget has been a total lack of concern displayed to the deteriorating safety conditions which led to many accidents in the current year. Further, the railway minister has not taken up any new project. All the 24 new trains announced have been from amongst the earlier proposals.

As regards plan expenditure, last budget saw a slashing of Rs. 735 crores. This year, the plan expenditure has been targetted at Rs. 11,090 crores. Of this, only Rs. 3,540 crore is to come from the general exchequer. Rs. 4,000 crores is to be raised through borrowings and another Rs. 3550 crores through mainly `non-traditional’ revenues.

A Rs. 1,000 crores is sought to be raised through commercial utilisation of railway assets. This combined with the privatisation of some railway services is bound to undermine the self-reliant basis of Indian railways.

Clearly these targets, as was the case last year, are unlikely to be met. This would directly contribute to the further deterioration of the safety standards of the railways which is a cause of major concern to the Indian people.

The budgetary calculations have been based on exaggerated targets and by drawing heavily on the capital fund of the railways for daily expenditures. The capital fund of the railways ought to have been utilised for developmental activities and improving safety standards rather than meeting the daily expenditures.

The freight traffic is projected to increased by 5 per cent while the average annual growth rate between 1991-1999 was only 2.2 per cent. Similarly, passenger traffic is projected to go at 9 per cent while the average declined from 4.6 per cent in 1991 to 3.2 per cent in 1999. Clearly, the shortfall in revenues as a result of such exaggerate projections will be met through additional burdens on the people on a later date.

The capital fund of the railways stood at Rs. 1200.64 crores at the end of the financial year 1998-99. Under the tenure of the present minister, this has come down to a measly Rs. 21.13 crores in the revised estimates for the year 2000-2001. The current budget estimates to utilise all the appropriations to this fund of Rs. 17.43 crores, thus leaving almost nothing for present or any future development of the railways.

Even on the score of generating greater resources through increase in freight charges and the growth of traffic to the tune of Rs. 500 crores, there are serious question marks. During the last year, revised estimates show a shortfall of Rs. 1,062 crores in gross traffic revenues. Yet, this budget anticipates an increase in revenue of Rs. 4,522 crores!

Further, much of the balancing in the budget has been done by deferring dividend payments of Rs. 1,000 crores to general revenues (GR). This is over and above the Rs. 1,500 crores of dividend that was not paid last year.

Clearly, this budgetary exercise is populist politics rather than a serious exercise to meet the safety and developmental requirements of the railways. It is absolutely certain that post-assembly elections, additional burdens on the people are in the offing to compensate the manipulated budgetary balancing done on the basis of exaggerated projections and withdrawals from the capital fund.

The Polit Bureau of the CPI(M) warns the Indian people to be prepared to resist the additional burdens that are bound to be imposed on them in the near future.