Railway passenger fare up by 14.2% in all class, freight fare up by 6.5%, effective from 25 June

New Delhi, 20 June, 2014

Government has hiked the Railway passenger fare by 14.2% in all classes with effect from 25 June while freight charge has been hiked by 6.5 per cent with effect from 25 June.

The decision of the Railways today restores an announcement of May 16, the day Lok Sabha election results came, when the same hike was effected but immediately put on hold.

The Railways had then issued a notification effecting hike in passenger fare by 14.2 per cent across the board and freight charges by 6.5 per cent from May 25. This was followed up with an official press release.

The May 16 fare hike decision, which had raised eyebrows as it came in the midst of Lok Sabha election results, led to a scurry of activities in Rail Bhawan on that day and the Railway Board went into a huddle to discuss its fallout.

Soon after, the red-faced Railway Ministry had put the decision on hold, saying the matter related to the revision will be left to the next government.

The then Railway Minister Mallikarjun Kharge came out with a statement directing the Board to leave the decision on the hike to the new government.

“It is now informed that under the directions of the Minister of Railways Mallikarjun Kharge, the decision on the proposed hike in the freight charges and passenger fares have been kept pended till further advice for placing this proposal before the new government,” the statement said.

A fresh notification was issued later, stating that the “revision of fares with effect from May 20 should be pended till further advice.”

Official note

The Railway passenger fare and freight rate revision was done as part of interim budget presented by the previous government. But the implementation of revised rates was withdrawn by previous regime because of the elections. Meeting the annual expenditure would not be possible unless the revised rates as finalized by previous government is implemented, hence order of withdrawing implementation of revised fare and freight has been withdrawn. Accordingly, the revised passenger fare and freight rates & freight structure rationalization will come into effect from 25th June 2014.

Note:

Railway’s loss per month is Rs. 900 crore. At present, the losses in the passenger segment are Rs 26,000 crore annually.