Train fares seen rising in 2017 as Indian Railways mulls safety cess

New Delhi: Come 2017, Indian Railways is likely to raise fares in order to cough up sufficient resources for strengthening track and upgrading safety-related infrastructure.

As per a PTI report, Railways is mulling increasing fares in a bid to raise resources after the Finance Ministry rejected its proposal of a special safety fund. According to the proposal, a safety cess will be levied to generate funds for strengthening track and upgrading signalling system and elimination of unmanned level crossings among other safety-related works to prevent mishaps.

The report added that earlier Railway Minister Suresh Prabhu had written a letter to Finance Minister Arun Jaitley seeking Rs 1,19,183 crore to create the special Rashtriya Rail Sanraksha Kosh for undertaking various safety works.

Since, the Finance Ministry has agreed to provide 25 percent of the  Rashtriya Rail Sanraksha Kosh and is said to have asked the Railways to raise 75 percent of resources on its own by raising fares, Railways is left with no option but to raise passenger fares.

“Though the Railway Minister is not in favour of raising fares at this juncture when passenger bookings are falling and fares of AC-2 and AC-1 are already on higher side, the reluctance of Finance Ministry to provide a bail-out package has left the minister with no option,” PTI quoted a source.

According to the plan, the cess on Sleeper, Second Class and AC-3 will be higher while it will be marginal for AC-2 and AC-1.

A final decision on raising fares is yet to be taken as modalities are still being worked out, added the news wire.