Indian Railways is likely to see an increase of around 30% in its Plan outlay for the next fiscal year, around R16,000 crore more than the revised Plan outlay of R52,000 crore in the current fiscal. The hike is expected even after Railways had to cut its annual plan for current fiscal as it failed to generate enough funds through internal resources.
According to sources in Rail Bhawan, a proposal of a Plan outlay of R68,000 crore, the highest ever, is being prepared. Once this is ratified by the finance ministry, it would be announced as part of Rail Budget proposals for 2013-14 later this month.
Out of the annual plan outlay, an amount of R38,000 is proposed as the Centre’s support through the Budget. “We are seeking a gross budgetary support (GBS) of R38,000 crore from the ministry of finance,” Vijaya Kanth, finance commissioner-Railway Board, told FE.
Last year, Railways got a GBS of R24,000 crore, but this year it is expecting R14,000 crore extra as it wants to clear a massive backlog of pending projects and also planning to spruce up its safety measures.
In the next fiscal, Railways is expecting to raise as much as R18,000 crore as market borrowing through Indian Railway Finance Corporation (IRFC). For 2012-13, it target was to raise R15,000 crore through IRFC as market borrowings. “We’ll be raising R18,000 crore through IRFC in the next fiscal,” the finance commissioner said.
Rest of the amount for the annual outlay of around R68,000 crore would come from extra budgetary support, internal resources and railway safety fund.
In 2012-13 Budget estimates, the Plan outlay of the national transporter was set at R60,100 crore, but after revision it was trimmed by R900 crore to R52,000 crore as it failed to generate enough funds through internal resources.
The major portion of annual plan outlay is spent towards modernisation of tracks and bridges (around 11% of plan outlay), modernisation of rolling stock (30%), capacity augmentation and signaling.
The railway proposal of an increased GBS is being vetted by the ministry of finance. The substantial portion of the annual outlay comes from the finance ministry as gross budgetary support. “The support from the finance ministry will be critical for us as extra GBS is necessary for the smooth operations of railways,” a senior rail ministry official said.
However, the finance ministry has proposed lower GBS for