Will Railway Budget Be Scrapped? NITI Aayog Says It’s A Failed Exercise

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Updated on 24 Jun, 2016 at 12:34 pm


In its recommendation to the Prime Minister’s Office (PMO), NITI Aayog said that Railway budget exercise had failed to be of use to the sector.

The government has sought the Railway Ministry’s comments on a 20-page note,  titled ‘Dispensing with the Rail Budget’, sent by NITI Aayog. It was jointly authored by Aayog member and economist Bibek Debroy and Kishore Desai, Officer on Special Duty.


Suresh Prabhu Railway Minister

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

The note argues that budget has become a ‘mechanism to announce popular measures’.

“The Railway Budget became a mechanism to announce popular measures, new trains, new routes, new rolling-stock manufacturing factories etc., with no concomitant focus on addressing Railways’ structural requirements, implementation of the ‘grand’ announcements, or funding needs,” states the note.


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Railway station Hot Stock Market

It further said that the ministry has failed to tackle the problem of under-investment and the proposed move will help in making Railways more ‘agile and efficient’.


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“Many committees have, in the past, recommended this (doing away the with Rail Budget).Perhaps because Rail finances are not as big as they used to be in 1924, when they were separated… now, in fact, it’s smaller than the Defence Budget. In any case, no decision has been taken, and a decision will not be taken overnight,” A K Mital, chairman, Railway Board, told The Indian Express.



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