Railway Budget 2016: Prabhu Sheds His Grace On Passengers, Spares Them From Fare Hike

The Railway Budget 2016 brought much relief to the passengers as Railway Minister Suresh Prabhu decided not to raise the fares. Freight charges too were not raised.


Suresh Prabhu Railway Minister

Suresh Prabhu showing the speech he would be delivering announcing the Rail Budget. Business Standard

To ensure that the decision on fares and freight charges do not impact the revenue of the railways, Prabhu, in his second Railway Budget, announced the undertaking of a review of competitive rates to help rationalize the tariff structure.

He also promised to expand the freight basket.

Prabhu also announced plans for the beautification of stations at pilgrimage centres including Ajmer, Amritsar, Bihar Sharif, Chengannur, Dwarka, Gaya, Haridwar, Mathura, Nagapattinam, Nanded, Nasik, Pali, Parasnath, Puri, Tirupati, Vailankanni, Varanasi and Vasco.

One of the highlights of the budget was the announcement of strengthened rail connectivity in Manipur and Mizoram.

A dedicated north-south, east-west and east coast freight corridors to be set up by 2019, too, has been promised in the budget.


A goods train passing a passenger train. The 2016 Rail Budget spares both from hike in fares and freight charges. Travel India

A goods train passing a passenger train. The 2016 Rail Budget spares both from hike in fares and freight charges. Travel India

Prime Minister Narendra Modi hailed the budget calling it “passenger-centric” with a vision for country’s rejuvenation.

He said the budget is “an infrastructure-led, development oriented, and employment generating” one.



Modi pointed out that the Railways witnessed 2.5 times more investment over the budgets prepared during the UPA rule.

But the budget failed to cheer up the mood of the Sensex. The 21 per cent hike in capital outlay brought the benchmark index below the 23,000 mark.

One major reason behind this is that the Railways incurred losses of over Rs.30,000 crore in 2015-16. Prabhu has now proposed alternate methods of raising revenue, including a plan to lease out vacant land along the tracks to promote horticulture and tree plantation.

According to the Railway Minister the move would help generate employment for underprivileged sections, augment food security and prevent encroachment.

The railways will set up an R&D organisation, a Special Railway Establishment for Strategic Technology & Holistic Advancement, SRESTHA. The organization will focus on long term research while the RDSO will now focus only on day to day issues.

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