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Subject: Economics

  • Privatisation of Indian Railways

    Indian Railways has launched the process of opening up train operations to private entities on 109 origin-destination (OD) pairs of routes using 151 modern trains.

    Objectives of privatisation

    • To introduce modern technology rolling stock with reduced maintenance.
    • Reduced transit time.
    • Boost job creation.
    • Provide enhanced safety.
    • Provide world-class travel experience to passengers.
    • Reduce demand-supply deficit in the passenger transportation sector.

    Issues with the move

    1) Responsibility issue

    •  Railway crew will work the trains (151 trains in 109 routes) which will be maintained by the private investor.
    • All the other infrastructure, track and associated structures, stations, signalling, security and their daily maintenance owned by the Railways will be fully utilised in running trains.
    • Thus, the responsibility of the private investor ends with investment in the procurement and maintenance of coaches.
    • Train operation, safety and dealing with every day problems rests with the Railways.
    • In case of an unfortunate event, fixing responsibility will be an issue.

    2) Day-to-day problems

    • Provision of an independent regulator to resolve disagreement, discords and disputes.
    • But this regulator will not be able to solve day-to-day problems of dichotomy unless the basic issue is resolved.

    3) Speed issue

    • Nearly all trunk routes in the existing network are speed limited to 110 kmph very few permit speeds of upto 120-130 kmph.
    • To raise it to 160 kmph, as proposed, there has to be track strengthening, elimination of curves and level crossing gates and strengthening of bridges.
    • There is no appreciable reduction in transit time for most proposed trains, when compared with the timings of the fastest train now operating on that route.

    4) Passenger fare issue

    • In the proposal, the Railways or government have no role in fixing passenger fares.
    • Fares will be beyond the common man’s reach.
    • Fare concessions extended to several categories of people will not be made available by the private investor.
    • The very objective of commissioning the Railways as a public welfare transport organisation is defeated.

    5) Reservation in Jobs

    • The private investor is not bound to follow reservation regulations in employment.
    • This, in turn, will deprive employment opportunities for those who are on the margins of society.

    6) Limited Coverage:

    • An advantage of Indian Railways being government-owned is that it provides nation-wide connectivity irrespective of profit.
    • Privatisation of railways would mean the railways will become a profit-making enterprise, this would lead to the elimination of railways routes that are less popular.
    • Thus, the privatisation of railways can have a negative impact on connectivity and further increase the rural-urban divide.

    7) Impact on the Economy:

    • Indian Railways is the backbone of India, it provides low fare transportation to agricultural and industrial trade.
    • Therefore, privatisation of Indian railways shall definitely affect the Indian economy at large.
    • Way forward
    • There should be no need for the government to take a dual role of a facilitator as well as a participant.
    • In the case of the metro railway services, Hyderabad, for example, an ideal PPP project, the concessionaire is solely responsible for daily maintenance, operation, passenger amenities and staff issues.
    • The State government steps in when it comes to land, power, permissions, law and order, etc. Fare determination is in consultation with the government.
    • Instead of a private entrepreneur, Indian Railway Catering and Tourism Corporation, a government undertaking which has gained experience in running the Tejas Express trains, could have been given the role.

    Consider the question “Indian Railways often hailed as the lifeline of the country continues suffering from several issues. In light of this, evaluate the pros and cons of the privatisation of railways.”

    Conclusion

    This project of privatisation of trains should not result in the common man being deprived of travel facilities. The Indian Railways is a strategic resource for the nation hence it should not be judged solely on its profit-generating capability or market-based return on investment.

  • APMC Act is not the main problem

    The APMC Act, which is often blamed for the woes of the farmers is not the main problem. This article argues that the root of the problems of Indian agriculture lies somewhere else.

    Agriculture post-1991

    • The priority post-1991 has been given to industry as well as services.
    • Middle-class consumers have been favoured by at the expense of farmers.
    • This neglect of agriculture resulted in an equally unprecedented gap between the standard of living in the rural and urban parts of the country.
    • As a result, the urban/rural ratio, in terms of monthly per capita expenditures, has jumped from 1.84 to 2.42 between 2012 and 2018.
    • This means that an average urban-dweller today can consume almost 2.5 times more than an average person in a village.

    Reforms by the government

    • Government has decided to liberalise India’s agriculture by amending the APMC Act and the Essential Commodities Act.
    • Contract farming will also be introduced in such a way that the buyer can assure a price to the farmer at the time of sowing.

     APMC Act in the context of Shanta Kumar Committee report

    • The argument against the APMC Act is that it does not allow the free market to function due to government intervention.
    •  It denies farmers the opportunity to determine the prices of crops in the marketplace.
    • In theory, this is a valid argument.
    • But, Shanta Kumar Committee observed in 2015 that only 6 per cent of farmers get the Minimum Support Price (MSP).
    • This is because of barriers to access for farmers as only 22 crops are procured under MSP.
    • Infrastructure is also inadequate as there are only an estimated 7,000 APMC mandis across India.
    • Procurement depends on the stocks required by the state.

    Why the APMC Act is not the problem

    1) Farm Pricing is the problem

    • The living costs of farmers was considered while determining agricultural pricing by the Agricultural Prices Commission (APC).
    • CACP that replaced the APC in 1985 added a 10 per cent mark-up over the MSP to account for entrepreneurial costs.
    • Such practices have been gradually eroded post-1991.
    • The problem, therefore, is not state intervention but the way the government deals with agriculture.

    2) APMC Act helped India build up food stocks

    • India managed to weather the 2008 global food crisis only because it had enough food stocks as Indian agriculture was not linked to the international futures market.
    • This was possible due to the procurement done through the APMC Act.

    3) APMC Act reformed already by States

    • Since agriculture is a state subject, the Act has been modified in 17 states.
    •  On the contrary, the condition of peasants has often been affected when the APMC Act has been diluted.
    • Bihar is a case in point.
    • The APMC Act was revoked in 2006 with the same rationale that further deregulation will attract private investment in infrastructure.
    • Not only has that not materialised, but the existing APMC market infrastructure was also dismantled.

    Reforms that Indian Agriculture needs

    1) Subsidy Reforms

    • Indian Agriculture is still too heavily subsidised in favour of the big players.
    • In the Union Budget 2019-20, the allocation for the Ministry of Agriculture was Rs 1,30,485 crore and the fertiliser subsidy alone was estimated at Rs 79,996 crore.
    • But these subsidies are concentrated on a few crops.
    • Agriculture economist Bruno Dorin has shown, only three crops receive more than 60 per cent of the so-called “non-product-specific” support to agriculture — rice, wheat and sugarcane.
    • This has led to environmental degradation like the depletion of groundwater levels and monocultures which are a threat to biodiversity.
    • It has also led to the industrialisation of agriculture, that results in the strengthening of a handful of multinational companies, which supply chemical inputs.
    • Liberalisation would only strengthen the role of large companies — including those in the agri-food sector.

    2) Agriculture needs to be ecologically viable

    • Structurally, farming needs to be made economically and ecologically viable in India.
    • State intervention for better pricing, investments in water harvesting and an agroecological transition could ensure a more resilient system to weather shocks like the current one.
    • The government could draw inspiration from the Andhra Pradesh Community Managed Farming model.
    • It promotes agroecological principles with the use of locally-produced, ecologically-sustainable inputs focusing on soil health..
    • Since the agro-ecological system of farming is more biodiverse in nature, it will make the system more resilient overall.
    • It will provide a safety net for farmers in case of crop damage due to various factors such as climate change or droughts.

    Consider the question “Though the APMC Act has been blamed for the farmers’ issues, it has historically been part of the solution. Critically analyse.”

    Conclusion

    By investing again in agriculture and following, at last, the recommendations of the M S Swaminathan Committee, the Government of India would also help bridge the drastic urban-rural divide.

    To read more about the issue:

    Marketing of Agricultural Produce in India: Definition; Role; APMC Act, Model APMC Act, 2003

    Original article:

    https://indianexpress.com/article/opinion/columns/rural-india-coronavirus-farm-trade-ordinance-apmc-act-6515414/

  • Adjusted Gross Revenue (AGR) in Telecom Sector

    The Centre and telcos assured the Supreme Court that they would not conduct any re-assessment or re-calculation of the Adjusted Gross Revenue (AGR) dues, which now stands at ₹1.6 lakh crore.

    Try this question for mains:

    Q.What are the various challenges faced by India’s telecom before the upgradation to 5G technology?

    What is AGR?

    • Adjusted Gross Revenue (AGR) is the usage and licensing fee that telecom operators are charged by the Department of Telecommunications (DoT).
    • It is divided into spectrum usage charges and licensing fees, pegged between 3-5 per cent and 8 per cent respectively.

    What is the issue?

    • The Bench observed that 15 or 20 years was not a reasonable time period and the telcos must come forward with an appropriate time frame.
    • The Centre had earlier urged the court that up to 20 years be given to the firms for the payments.
    • The telcos said they were in no position to give fresh bank guarantees for the payments.

    Why is AGR important?

    • The definition of AGR has been under litigation for 14 years.
    • While telecom companies argued that it should comprise revenue from telecom services, the DoT’s stand was that the AGR should include all revenue earned by an operator, including that from non-core telecom operations.
    • The AGR directly impacts the outgo from the pockets of telcos to the DoT as it is used to calculate the levies payable by operators.

    Read the complete issue here at:

    https://www.civilsdaily.com/news/explained-adjusted-gross-revenue-agr-in-telecom-sector/

  • Exporting agri-inputs

    Some changes could make India exporter of agri-inputs. The article examines bottlenecks that holds India back and suggests the policy changes in key agri-inputs-seeds, fertilisers and machinery.

    Context

    In the following 3 key agri-inputs India has the untapped potential. What is needed is policy changes.

    1) Seeds

    • India can emerge as an important seed producer and a large exporter of seeds to many developing countries in South and South-east Asia as well as Africa.
    • The country can produce very competitively-priced seeds for hybrid rice, hybrid corn, hybrid Bt HT cotton, and several vegetables including tomato, potato and okra.
    • For this to happen, we have to set our regulatory system right.
    • Let’s use the case of cotton.
    • India’s decision in March 2002 to allow Bt cotton made India the largest producer of cotton in the world and the second-largest exporter of cotton by 2013-14.
    • But due to policy changes since 2014-15 and issues such as trait fees companies stopped the introduction of new generation of seeds
    • Now there is an “illegal” spread of Bt HT cotton in Maharashtra.
    • This is partly because our regulatory system is complex.
    • And more so because the present government has ideological blinkers against modern science.
    • This is the biggest bottleneck holding India back from becoming the seed capital of the developing world.

    2) Fertilisers

    • India has been a net importer of fertiliser nutrients (NPK) for almost two decades.
    • In 2019-20, India imported fertilisers worth $6.7 billion, topping the list is urea $2.9 billion.
    • We are totally dependent on imports and likely to remain so in case of MOP and in the case of DAP.
    •  In the case of urea, India wants to be atmanirbhar by opening up five new urea plants in the public sector with a total capacity of 6.35 MMT.
    • Almost 70 per cent of the gas being used in urea plants is imported at a price much higher than the price of domestic gas.
    • The cost is going to be more than $400/tonne when the international price generally hovers between $250-300/tonne.
    • The government should allow existing private sector urea plants to expand and produce at a much lower cost.
    • The best way to achieve self-reliance in fertilisers is to change the system of fertiliser subsidies.

    Suggestion on changes in fertiliser subsidies

    • 1) Deposit equivalent cash directly into farmers’ accounts, calculated on a per hectare basis.
    • 2) Free up fertiliser prices.
    • 3) Allow the private sector plants to compete and expand urea production in a cost-competitive manner.

    3) Farm machinery

    • Before the Green Revolution, India produced only 880 tractor units.
    • It increased to about 9,00,000 units in 2018-19.
    • So, India is the largest tractor manufacturer in the world.
    • India also exported almost 92,000 tractors, largely to African and ASEAN countries.
    • Though Green Revolution gave tractor production a push, the real break-through came after de-licensing in 1991.
    • The new class of entrepreneurs and start-ups are coming up with special apps for “Uberisation of tractor services”.
    • In an economy of small landholders, owning a tractor is a high-cost proposition as it is not fully utilised.
    • This needs to be made more efficient by creating a market for tractor services.

    Consider the question “Despite having the potential to transform itself into the exporter of agri-inputs, India ends up being the importer of some of them. In light of this examine India’s potential to become the exporter of agri-input products and suggest the measures to achieve this.”

    Conclusion

    The private sector is our strength. The only thing the government has to do is to unshackle them from the chains of controls and webs of unnecessary regulations. They will make an Atmanirbhar Bharat.

  • Godhan Nyay Yojana to boost rural economy

    Chhattisgarh is set to launch ‘Godhan Nyay Yojana’. The scheme aims to put money in the pockets of people living in rural areas and also solve the problem of stray cattle.

    Try this question from CSP 2019:

    Consider the following statements

    1. Agricultural soils release nitrogen oxides into the environment.
    2. Cattle release ammonia into the environment.
    3. Poultry industry releases reactive nitrogen compounds into the environment.

    Which of the statements given above is/are correct?

    (a) 1 and 3 only

    (b) 2 and 3 only

    (c) 2 only

    (d) 1, 2 and 3

    Godhan Nyay Yojana

    • Under the scheme, the Chhattisgarh government will purchase cow dung at the rate of Rs 2 per kg.
    • This scheme will turn cow dung into a profitable commodity.
    • The scheme also aims to make cow rearing economically profitable and to prevent open grazing in the state, as well as help with the problem of stray animals on roads and in urban areas.

    How will the scheme help the rural economy?

    • The scheme will generate additional income and increase employment opportunities.
    • The government will procure cow dung and prepare vermicompost in order to move towards organic farming.
    • There is a huge market for organic farming. Vermicompost will be sold by cooperative societies.
    • Distribution of vermicompost fertilizer to farmers will be done as a commodity loan by cooperative societies, banks.

    Preventing strays in urban areas

    • In urban areas, the scheme will prevent movement of stray animals on roads and highways, and also improve urban sanitation with proper disposal of waste produced by cattle.
    • Cattle will be tagged with the owner’s name, address, mobile number to the neck of each animal after the survey to ensure accountability of cattle owners if their cattle are found in the open.

  • Issue of Food subsidy in India

    Solutions to Problems in Food Subsidy Delivery

    The following solutions will help in addressing problems associated with PDS.

    1. Replacing Targeted Public Distribution System (TPDS) with Direct Benefit Transfer (DBT) of food subsidy. National Food Security Act (NFSA) states that the centre and states should introduce schemes for cash transfers to beneficiaries.Cash transfers seek to increase the choices available with a beneficiary, and provide financial assistance.  It has been argued that the costs of DBT may be lesser than TPDS, owing to lesser costs incurred on transport and storage.  These transfers may also be undertaken electronically. As per a report given by a high level committee of Food Corporation of India, DBT would reduce Government subsidy bills by more than Rs 30,000 crores.
    2. Automation at the Fair Price Shops is another important step taken to address the problem in PDS. Currently more than 4.3 lakh (82%) Fair Price Shops have been automated across the country. Automation involves installation of Point of Sale (PoS) devices, for authentication of beneficiaries and electronic capturing of transactions.
    3. Aadhar and introduction of Biometrics was recommended to plug leakages in PDS. Such transfers could be linked to Jan Dhan accounts, and be indexed to inflation. It  facilitates the removal of bogus ration cards, check leakages and ensure better delivery of food grains. In February 2017, the Ministry made it mandatory for beneficiaries under NFSA to use Aadhaar as proof of identification for receiving food grains.
    4. 100% ration cards had been digitised.
    5. Between 2016 and 2018, seeding of Aadhaar helped in detection of 1.5 crore fake, duplicate and bogus ration cards and these cards were deleted.
    6. Increase the procurement undertaken by states known as Decentralised Procurement (DCP), and reduce the expenditure on centralised procurement by the Food Corporation of India (FCI). This would drastically reduce the transportation cost borne by the government as states would distribute the food grains to the targeted population within their respective states. As of December 2019,17 states have adopted decentralised procurement.
    7. The Fair Price shops operate at very low margins as per findings of the Government. Hence the fair price shops should be allowed to sell even non-PDS items and make it economically viable. This will motivate them to not to resort to unfair practices in the distribution of Government subsidized food grains meant for beneficiaries of Government schemes.
    8. A greater and more active involvement of the panchayats in the PDS can significantly improve access at the village level.
    9. There is also an urgent need to set up a proper and effective grievances redressal system for both the fair price shops as well as beneficiaries

  • [pib] ASPIRE Portal

    The International Centre for Automotive Technology (ICAT) is developing a technology platform for the automotive industry called ASPIRE – Automotive Solutions Portal for Industry, Research and Education.

    Try this MCQ:

    Q.The recently launched ASPIRE Portal deals with:

    a) Aspirational Districts

    b) Primary Education

    c) Industrial Clusters

    d) Automotive Technology

    ASPIRE Portal

    • The key objective of this portal is to facilitate the Indian Automotive Industry to become self-reliant by assisting in innovation and adoption of global technological advancements.
    • It aims to bring together the stakeholders from various associated avenues.
    • This includes bringing together the automotive OEMs, Tier 1 Tier 2 & Tier 3 companies, R&D institutions and academia (colleges & universities) on matters involving technology advancements.
    • The activities would include R&D, Product Technology Development, Technological Innovations, Technical and Quality Problem Resolution for the industry, Manufacturing and Process Technology Development etc.
    • Apart from acting as a solution and resource platform, the portal will also host grand challenges in line with the need of the industry as will be identified from time to time, for development of key automotive technologies.

    About ICAT

    • International Centre for Automotive Technology (ICAT) is located at Manesar in Gurugram district of Haryana.
    • It is a govt entity owned by the Ministry of Heavy Industries.
    • It has facilities for vehicle homologation and also testing laboratories for noise, vibration and harshness (NVH) and passive safety.
    • It also includes a powertrain laboratory, engine dynamometers, emission laboratory with Euro-V capability, a fatigue laboratory, passive safety laboratory, and vehicle test tracks.

  • A demand problem contributing to lower imports

    India registered a trade surplus after almost two decades. But this is not the result of a sudden rise in India’s export. It is due to subdued import indicating the low demand.

    What latest data indicate

    • Data released by the commerce ministry indicate a contraction in exports observed over the past few months easing slowly.
    • But the continuing contraction in import which indicates low demand is worrying.
    • This is trend is leading to the growing gap between import and export.

    India registered a trade surplus: what it indicates

    • This growing gap led to India registering a trade surplus of nearly $800 million in June.
    • This is the first time in almost two decades that the country has registered a trade surplus.
    • But does this mean that India’s exports have grown drastically?
    • No. It is a sign of collapse in domestic demand.

    Merchandise exports growing trends

    • India’s merchandise exports continue to witness an upward swing.
    • The pace of contraction fell to 12.4 per cent in June, from 36.2 per cent in May and 60 per cent in April.
    • Exports of items such as iron ore, drugs and pharmaceuticals, chemicals and various agricultural commodities saw an expansion in June.

    What growing exports and falling import indicate

    • An upswing in exports could be indicative of a faster recovery of India’s export partners.
    • Restrictions on economic activities in some of these countries had eased earlier.
    • Other reason could be the rush by Indian exporters to ship out orders to meet their seasonal deadlines.
    • Imports continue to remain deep in negative territory.
    • The contraction in non-oil exports has actually worsened with decline observed in both consumer and investment/industrial goods imports.
    • Some movement is visible in imports of electronic goods.
    •  But the import of machinery and transport equipment has not moved significantly.
    • Of the 30 main import items, only four registered mildly positive growth in June — this indicates the pace of the domestic slowdown.

    Conclusion

    Economic activities across the world will take time to return to normalcy, India’s exports will take time to reach pre-COVID levels. It seems that the chasm between exports and imports could persist, given the plateauing of the post-lockdown spurt in demand/production.

  • [pib] India Energy Modeling Forum (IEMF)

    In the joint working group meeting of the Sustainable Growth Pillar of the India-US partnership, an India Energy Modeling Forum was launched.

    Note the following things about IEMF:

    1. It is a bilateral forum.

    2. It is not associated with any International Agency say UN, IEA, IAEA etc.

    3.On March15 last year, the idea was incepted and only a formal workshop was organized on IEMF (it wasn’t launched).

     

    UPSC can puzzle you along these 3 points in a statements-based MCQ.

    India Energy Modeling Forum (IEMF)

    • The IEMF seeks to provide a platform for policy makers to study important energy and environmental issues and ensure induction of modelling and analysis in informed decision making process.
    • The Forum aims to improve cooperation and coordination between modeling teams, the GoI, knowledge partners and think-tanks, build capacity of Indian institutions, and identify issues for joint modeling activities and future areas of research.

    What is Energy Modelling?

    • Energy modeling or energy system modeling is the process of building computer models of energy systems in order to analyze them.
    • There exists energy modelling forums in different parts of the World.
    • Such models often employ scenario analysis to investigate different assumptions about the technical and economic conditions at play.
    • Outputs may include the system feasibility, greenhouse gas emissions, cumulative financial costs, natural resource use, and energy efficiency of the system under investigation.
    • Governments maintain national energy models for energy policy development.

    Outcomes of the forum

    • Discussions on energy modelling in India and the world explored how energy modelling can play an important role in decision-making.
    • The panelists laid focus on bridging the rural-urban divide and factoring in energy pressures from the informal economy within models.
    • Deliberations included a spotlight on how the impact of the evolving character of India’s cities, industries and especially the transport sector should be included in the any India-centric models.
    • The shift towards electric mobility, an increasing emphasis on mainstreaming of renewable energy options and overarching environmental concerns were also stated as key factors for determining India’s energy future.

  • Private trains on Indian Railways network and its implications

    The article analyses the implications and issues with the Indian Railways recent move to allow the private investors to operate the passenger trains on selected routes.

    Let’s understand the structure of IR’s passenger business

    • It operated a daily average of 13,523 passenger trains in 2018-19.
    • It includes 3,695 inter-city mail and express services.
    • 3,947 ordinary short-distance-stopping “regional” trains.
    • 5,881 electrical multiple units operated on suburban sections for intra-city passengers.
    • The regional/sectional trains, with multiple stops, cater to short-distance journeys (an average of 111 km in 2018-19) and contribute maximum loss in passenger business.
    • The inter-city mail and express services constitute IR’s core passenger business.
    • It needs to be duly nurtured and developed.
    • Within this category, only the upper-class portion will be of interest to private operators, due to flexibility in fixing fares.

    Now, let’s analyse the implications of privatisation decision

    The stated objectives are-

    • 1) Reducing the supply-demand deficit.
    • 2) Encouraging modal shift from air to rail.
    • 3) Significantly reducing transit time.

    Let’s analyse the issues with the objectives

    1) Reducing the supply-demand deficit

    • Passenger ridership on railways has almost been stagnant at 8,354 million in 2018-19.
    • The Railways’s endemic capacity constraint has kept its share in the nation’s transport market steadily decreasing.
    • Despite the demand for more trains, its seven high-density corridors stretched over 10,500 km remain clogged.
    • Its stations and maintenance wherewithal are over-stretched.
    • Speeds remain low and services far less than satisfactory.
    • Rail travel demand far outstrips supply and remains set to further grow substantially.
    • The steadily growing services sector continues to trigger high mobility and demand for passenger travel, generally in the upper classes.

    2) Modal shift from air to rail

    • Transfer of traffic to rail will depend on-
    • 1) reduced journey time
    • 2) the frequency of rail services
    • 3) offering accommodation on demand.
    •  Rail travel needs to appropriately match air and road services in terms of pre-board and onboard convenience, reliability, and speed.
    • As it faces competition from budget airlines, high-capacity buses, and personal cars, IR needs to craft a concerted strategy to expand, accelerate and modernise its inter-city passenger services.

    3) Reducing transit time

    •  Freight, as well as passenger trains across the network, have remained stuck in slow tracks over decades.
    • The “pilot project” of IRCTC-operated upscale “Tejas” train-sets clock virtually the same travel time as the older Shatabdis on these routes.
    • On completion of the two ongoing DFCs by December 2021, and the contemplated up-gradation of existing Delhi-Mumbai and Delhi-Kolkata rail routes will see trains running at 160 km/h.
    • Most other paths with mixed freight and passenger trains jostling for space and constrained by speed limits.
    • This will lead to the new train-sets to be substantially under-utilised in terms of their potential, and at far below expectations of customers for faster and frequent services.

    Issues

    1) Absence of regulator

    • An autonomous regulator, vital for the equitable and effective functioning of the private operators.
    • It is not without a challenge that the private train operators will strive to provide value for money to passengers and ensure their profitability in an environment of a price war.
    • So, the absence of an autonomous regulator is essential.
    • Experience of the licensed container train operators with the Railways alone driving policy and settling disputes has not been encouraging.

    2) Concessions issue

    • A 35-year concession in an age of rapidly evolving technologies impacting design contours of train-sets as much as customer expectations raise plausible questions.
    • Taking a plunge in 100 paths without first testing the waters on few selected sections is could also give rise to issues.

    Suggestions

    •  Some structural shifts in IR’s business management are now a clear imperative:
    • 1) Segregating its passenger and freight businesses for focussed attention.
    • 2) Restructuring the tariffs rationally and urgently.
    • 3) Developing terminal infrastructure.
    • 4) Leapfrogging the conversion of the existing dual-use high demand trunk routes into semi high-speed corridors.

    Consider the question “What are the objectives of the recent move of the India Railways to invite the private investors to operate some passenger trains on selected routes? What are the issues railway’s passenger service faces? Suggest the measures to deal with the issues.

    Conclusion

    The result of the move would suggest the future path for the operation for railways. But it must ensure the level playing field to the private players to test the efficacy of the move.

    Source:

    https://www.financialexpress.com/infrastructure/railways/private-trains-on-indian-railways-network-why-one-cant-ignore-several-red-flags/2025432/