Indian Railways decides to allow private operators to decide fares for 151 planned trains

The Indian Railways on Monday said the private companies shall have the freedom to decide on the fare to be charged from its passengers as the national transporter prepares to get 151 run trains across 100 routes via public-private partnership (PPP). However, the Chairman Railway Board at a press conference had allayed fears that prices of tickets of private trains will be too expensive and said that they will be market-driven and based on competitive pricing.

Private train operators to share gross revenue 

The Railways recently floated a Request for Qualification (RFQ) inviting private entities to operate passenger trains on its network. In the document, it has said that bidders based on their financial capacity, will be required to offer a share in the gross revenue at the request for proposal (RFP) stage for undertaking the project. 

While the Railways has given private players the freedom to fix the fare to be charged from passengers, they will also have the freedom to explore fresh avenues to generate revenue, according to the RFQ.

The definition of gross revenue, which is under consideration is as follows- Any amount accruing to the concessionaire (private entity) from passengers or any third party from the provision of following services to the passengers on account of running of trains under the concession agreement: amount printed on ticket- fare; amount from preferred seat options, baggage/ luggage, cargo/ parcel (if not included in the ticket fare), the RFQ stated. 

The amount from onboard services such as catering, bedroll, content on-demand, Wi-Fi (if not included in the ticket fare). Any amount accruing to the concessionaire on account of advertising, branding and naming rights pursuant to the concession agreement, the document stated. 

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Railways announces privatisation

On July 2, Chairman Railway Board V K Yadav announced that private train operations are likely to begin by April 2023, all coaches will be procured under Make in India policy. He said that train sets have to be brought by private operators and maintained by them and if any performance indicators are not met by private players in passenger train operations they will be penalised. Moreover, he added that private participation in passenger train operations will only be 5% of the total operations of Railways and will result in a quantum jump in technology, higher speeds.

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(With PTI inputs)