Financial Daily from THE HINDU group of publications
Friday, Sep 06, 2002
Logistics - Railways
Railway bifurcation: Zones of contention
IN 1998, during his earlier stint as Railway Minister, when Mr Nitish Kumar came out with a status paper on the Indian Railways and a white paper on its projects, he was hailed as a visionary and a bold minister by almost everyone in the Railway establishment. The status paper put in perspective the health of the Railways and what needed to be done, while the white paper gave an update on the projects and why some were taken up at all. Even politicians accepted, albeit grudgingly, that the Minister had been bold in highlighting the reasons for the downslide of the Railways.
Now, it is the same Mr Nitish Kumar who is at the receiving end not only from former railway officers, but also political opponents. The reason is his decision to carve out new railway zones from some of the existing ones. Mr Nitish Kumar finds himself in the dock for merely implementing a decision taken six years ago when he was not even in government then.
And, opposing him tooth and nail is his immediate predecessor, Ms Mamata Banerjee, whose Trinamool Congress is a member of the ruling NDA at the Centre, but which has said it will not be part of the ruling coalition till the dispute is settled in its favour. Ms Banerjee may not be opposed to the creation of all the six zones as planned, but only to the proposed bifurcation of the Eastern Railway, with its headquarters in Kolkata, and create a new zone whose headquarters would be in Hajipur in Bihar. It is because of this that the issue is threatening to snowball into a Bengal versus Bihar battle. Not surprisingly, politicians of all parties from Bihar have welcomed the move while those in West Bengal are opposed to the move to bifurcate Eastern Railway.
Hajipur, it must be reminded, is the constituency that returned Mr Ram Vilas Paswan, and it is here that Mr Paswan, as Minister, decided that the new zonal headquarters must be located, as a measure of improving efficiency of the Eastern Railway. Along with this, the then government announced the setting up of five more zones with headquarters at Jaipur, Allahabad, Jabalpur, Bhubaneswar and Bangalore. The new zonal offices were even formally inaugurated then, but the notification in the gazette could not be issued because of intense political opposition, especially from Andhra Pradesh to the move to transfer some railway zones from Andhra Pradesh to the new zones headquartered elsewhere.
Mr Nitish Kumar is firm on going ahead with the bifurcation as, he says, it will improve efficiencies in the railways. The Union Cabinet has also endorsed his stand. Some former Railway Board chairmen have even written an open letter to the Prime Minister, excerpts of which were reproduced in the media, describing the move to have new zonal railways as "Hajipurisation", implying that creating a new zonal railway with headquarters in Hajipur is yet another largesse from Mr Paswan to his constituency. Mr Nitish Kumar may well argue that what he is doing now is only a logical follow-up of decisions taken in 1996.
All those against the creation of additional railway zones point, in support of their argument, to the reports of various committees that have opposed any further division of the existing zones. The first major reorganisation of the Indian Railways took place in 1948 and the last zonal reorganisation in 1966, after which the number of zones went up to nine. Since then, both passenger and freight traffic have increased several times, but the railway administration has not felt the need to create additional zones. The main reason for this is the excellent communications infrastructure the Railways has. The increasing use of information technology is all the more reason why the proposal to create additional zones becomes redundant.
At present, the Railways network stretches over 62,000 route km, covered by some14,500 trains. The Railways carries 13 million passengers and 1.4 million tonnes of freight every day. The Railway Board which, as a policy making body, is also responsible for investment decisions is also in-charge of coordinating among the nine zones. The zones are further divided into 59 divisions which are, in effect, responsible for maintaining the infrastructure and running the trains.
The zonal railways, headed by general managers, are administrative offices for a set of divisions, coordinate amongst divisions and with adjoining zones, liaise with State governments and trade and industry bodies, identify projects that need to be taken up and prioritise them on the basis of need and income potential to the Railways.
According to those who favour further division of the zones, staff strength in some zones is more than two lakhs, while the route km in some is more than 10,000 km. They argue that it takes more than 24 hours to reach the end point in some zones and the turnover of some zones is more than Rs 7,000 crore. All this, they argue, calls for further division so that control is better and efficiency improves.
The fact remains that the Indian Railways is probably one of the few entities in the country that is not organised on the lines of specific States. For instance, the Bharat Sanchar Nigam Ltd, the public sector telephone service provider, is organised in terms of specific States, and within that for larger cities. The Railway zones are not organised on the basis of the States they cover and their headquarters is not located in any particular State for geographical consideration but for the fact that that State might be the largest traffic or revenue earner for the Railways. That is why no one objects to the fact that Mumbai is headquarters for both the Western and Central Railways.
Now, what the proposed reorganisation of the new zones will lead to is that some States that already feel they are not getting their due share in terms of railway projects, will demand that a zone be created for them so that more projects and services come up. And, in the kind of set up in power at the Centre, it will be difficult for the Railway Ministry not to oblige these States, depending on how powerful they are for keeping the coalition together.
The Railway establishment has made it out that the investment in creating the six additional zones will be only of the order of Rs 600 crore and that this will translate into Rs 100 crore for each zone over five-six years. And, given the scale of the Railways' operations about Rs 40,000 crore of earnings and a similar amount of expenditure the money proposed to be spent is hardly anything. The expenditure will be only Rs 600 crore if the work is completed on schedule, what of time over-runs. As it is, some former Railway officers point out that the cost could be anything double of what is projected. True, given the scale of its operations, even Rs 1,200 crore is not much. But in these times of severe cost cutting all around, not just in the private sector, what is the compelling need to spend that amount. It is not as if the staff of the existing zones will be equally divided when the new zones are created. There is bound to be some increase in staff strength and the cost it entails. Not to mention the cost of putting up housing colonies, posting six more general managers and their office paraphernalia.
More than the costs involved, the main fear that has not been voiced is the impact creating new zones will have on their functioning. Large contracts are decided at the zone level and with some zones being more or less confined to a particular State, the pressure on the zonal officers from the local politicians will be immense.
Some former railway officers also debunk the argument that a zone that covers more than two States will only take care of the interests of the State in which it is headquartered. Projects are decided or recommended, more often than not, on the economic sense they make and not out of geographical considerations.
For example, if the Southern Railway headquartered in Chennai finds a project in Kerala to make a lot of business sense, it will go ahead and pursue that project with the Railway Board rather than something else in Tamil Nadu, which can always be taken up later.
In the din over the proposed bifurcation, especially of the Eastern Railway, what Ms Mamata Banerjee and other politicians from West Bengal have not articulated well is the fear that the State will slowly lose its importance in matters like this. Ms Banerjee and other politicians from West Bengal are worried that bifurcating the Eastern Railway will result in the further eclipsing of West Bengal from the economic map of the country.
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