Railway budget to be merged with Union Budget from 2017-18 financial year.
Possible implications
-By doing away with separate railway Budget, half of the railways’ problems would be solved.
-The minister, in fact, would be a loser but railways will certainly gain. However, in another sense, the minister would become more self-disciplined and not recklessly announce bounties, projects and trains, because in that case he has to take a nod from the finance ministry in advance.
-Earlier, the railway minister was behaving like a monarch and did what he wanted. “Roll back or resign” was the dictum of the day.
More benefits
-The other benefits for the railways are obvious. As a ministry, subservient to the finance ministry, the railways will not have to pay dividend which amounts to about Rs 4,000-5,000 crore annually.
-Again, the burden of pay commission would totally fall on the finance ministry.
-Moreover, the budgetary support will not be dwindled annually, as a routine. In actual practice, the finances of the railways, as part of central finances, would not deteriorate, but improve. What else does the railways want?
The separate rail Budget has outlived its utility. When it was introduced in 1924 on the recommendation of the Acworth Committee, conditions were different. Railways then used to generate most of the GDP and any change in the exchequer accounting process would disturb the railways’ financial system and working.
Moreover, to make the railways more Indian-oriented in its approach and manifestation, the central control of the railway Budget was creating a stumbling block in bringing it more down to earth, to stand as an independent body. Slowly, it would nationalise itself to be freed from the capital invested in the shape of a guaranteed and semi-guaranteed system.
There have been many ups and downs for the railways due to internal and external factors. But never did the railways create confusion and chaos and solved its problems more gracefully and on its own.
However, since Independence, there has been a drastic change in its approach and functioning. Once it enjoyed the status of being one of Navaratnas of Indian public sector, but soon after it fell from grace, the clamour of de-nationalisation started haunting it. The Rakesh Mohan Committee, while noting the decline, suggested corporatisation of railways.
Possible implications
-By doing away with separate railway Budget, half of the railways’ problems would be solved.
-The minister, in fact, would be a loser but railways will certainly gain. However, in another sense, the minister would become more self-disciplined and not recklessly announce bounties, projects and trains, because in that case he has to take a nod from the finance ministry in advance.
-Earlier, the railway minister was behaving like a monarch and did what he wanted. “Roll back or resign” was the dictum of the day.
More benefits
-The other benefits for the railways are obvious. As a ministry, subservient to the finance ministry, the railways will not have to pay dividend which amounts to about Rs 4,000-5,000 crore annually.
-Again, the burden of pay commission would totally fall on the finance ministry.
-Moreover, the budgetary support will not be dwindled annually, as a routine. In actual practice, the finances of the railways, as part of central finances, would not deteriorate, but improve. What else does the railways want?
The separate rail Budget has outlived its utility. When it was introduced in 1924 on the recommendation of the Acworth Committee, conditions were different. Railways then used to generate most of the GDP and any change in the exchequer accounting process would disturb the railways’ financial system and working.
Moreover, to make the railways more Indian-oriented in its approach and manifestation, the central control of the railway Budget was creating a stumbling block in bringing it more down to earth, to stand as an independent body. Slowly, it would nationalise itself to be freed from the capital invested in the shape of a guaranteed and semi-guaranteed system.
There have been many ups and downs for the railways due to internal and external factors. But never did the railways create confusion and chaos and solved its problems more gracefully and on its own.
However, since Independence, there has been a drastic change in its approach and functioning. Once it enjoyed the status of being one of Navaratnas of Indian public sector, but soon after it fell from grace, the clamour of de-nationalisation started haunting it. The Rakesh Mohan Committee, while noting the decline, suggested corporatisation of railways.
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