Rationalization Of Both Freight And Passenger Fares:
The Parliamentary Standing Committee on Railways has suggested rationalisation of both freight and passenger fares.
- The losses incurred by the railways in passenger services purportedly due to the social service obligations which include pricing tickets at fares lower than costs and passenger concessions.
- The railways incur losses to the tune of Rs. 35,000-38,000 crore a year in the passenger segment.
- Revenues from passenger services further deteriorated due to the suspension of operations during Covid-19.
- Operating Ratio: Noted the regular deterioration in Railways Operating Ratio (OR).
- OR indicates how much the Railways spend to earn a rupee. It helps determine the financial health of the Railways.
- For 2020-21, it is estimated to be 131.4%.
- For 2021-22, Railways is targeting OR of 96.15%.
