Finance Ministry Accepts Suresh Prabhu’s Proposal For ‘No Rail Budget’

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2:07 pm 15 Aug, 2016

Accepting Railway Minister Suresh Prabhu’s proposal to merge Rail Budget with the General Budget, Finance Ministry on August 14 agreed to end the age-old practice.

For 92-years Rail Budget came as separate budget in the parliament.


suresh postwer

This practice bore on the Indian Railway an additional annual dividend to pay for its gross budgetary support.

The finance ministry wants to implement this merger from the next fiscal itself and has already constituted a five-member committee to work out the modalities.


These 5 members comprise of senior officials of the Ministry and the national transporter and have been asked to submit their report by August 31 this year.

With the burden of Railway Budget, the public sector has to bear an additional burden of about Rs 40,000 crore on account of implementation of the 7th Pay Commission, besides an annual outgo of Rs 32,000 crore on subsidies.

It is believed the move is part of PM Modi’s reform agenda and will help the Financial Ministry in dealing with issues such as raising passenger fares.


Prabhu believes the merger in the long-term is in the interest of the national transporter as well as the country’s economy.

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