On the back of steady growth in the economy, railway ministry officials indicate that Budgetary estimates outlined last year are likely to be met despite a shortfall in the earnings from passenger traffic and parcel services in the first three quarters of the current financial year (2009-10).
"Revenue and plan expenditure has been proportionately higher than estimated. Growth of earnings from passenger traffic and parcel services has been slightly slow.
"However, with earnings from freight recording double-digit growth, revenue targets can be expected to be met," a senior official at the ministry said.
The gross traffic receipts of the railways are estimated at Rs 90,626 crore (Rs 906.26 billion) in 2009-10, against 84,233 crore (Rs 842.33 billion) garnered in the last financial year.
During April-December last year, railways had registered a 7.7 per cent growth in passenger earnings against the budgetary target of 10.8 per cent.
During this period, railways had raked in Rs 17,497 crore (Rs 174.97 billion) from passenger operations, against Rs 16,242 crore (Rs 162.42 billion) it had earned in the corresponding period in 2008-09.
Ministry sources say the shortfall in earnings is mainly on account of reductions in the fare structure announced in the interim budget last year.
Besides, an official added, the decline in mobility with less number of people travelling in search of jobs since the announcement of the flagship National Rural Employment Guarantee Scheme two years back has affected the growth in passenger traffic.
If the trend persists, railways are unlikely to generate the Rs 24,309 crore (Rs 243.09 billion) it intends to earn from passenger operations in 2009-10. Same seems to be the case with its earnings from parcel services.
Earnings from parcel services has registered a marginal increase of around 15 per cent at Rs 1,703.45 crore (Rs 17.03 billion), against the targeted growth rate of 40 per cent during the April-December period.
On the positive side, railways' freight business has picked up significantly since September last year. Railways have surpassed the loading target for the April to December period by over 10 million tonnes. Revenue from freight traffic has grown by over 10 per cent.
"The trend of freight loading indicates we will surpass the budgeted target of Rs 58,525 crore (Rs 585.25 billion) in goods earnings," the ministry official added.
However, in view of the shortfall in earnings and with ordinary working expenses overshooting the spending limit by a good Rs 2,500 crore (Rs 25 billion) till November last year, ministry officials are making efforts to save in staff cost, contractual payments, contingent and fuel expenses.
Another ministry official informed: "Ninety per cent of additional requirement in working expenses has been due to an increase in staff cost. The payment of arrears under the Sixth Pay Commission is affecting the resource generation of railways. But if the austerity measures take stead, railways would be able to save nearly Rs 2,300 crore (Rs 23 billion)."
The total expenditure for 2009-10 has been pegged at Rs 77,119.7 crore (Rs 771.19 billion), compared to Rs 66,108.7 crore (Rs 661.08 billion) spent in 2008-09.
Between April and December 2009, the railways' total earning stood at Rs 62,975.58 crore (Rs 629.75 billion), an increase of 8.76 per cent over the Rs 57,901.88 crore (Rs 579.01 billion) earned during the same period last financial year.
Of this, Rs 42,146.84 crore (Rs 421.46 billion) has come from freight traffic, which has grown by 10.11 per cent over the Rs 38,278.55 crore (Rs 382.78 billion) earned in the year-ago period.
