Escalator at the point of entry into a 2-tier railway station.
The just announced increase in railway fares ( 14.2% for passenger fare and 6.5% for freight traffic ) is sharp and sudden. If the government sets its foot firm amidst the impending protests calling for a reversal of the decision, it will signal the prefatory steps of the transformation of the Public Sector Behemoth, the Indian Railways, as a commercial organization from a predominantly held view of a social welfare oriented organization in our context.
Refreshment stall at the point of entry into a 2-Tier railway station.
The move is also an expression of the leadership’s commitment to a market oriented/friendly approach to issues clearly spelt out earlier by the government.
Coming as it does after years of stability in tariff rates to which people have been almost fully acclimatized, the increase is sure to make people put their back(s) up strongly. It is like more than dropping a brick in a discussion.
Escalator within the platform for passengers.
Improving the financial strength of the railways has been the main aim and raising the tariff is one of the “profit plays” here. Knowing clearly that there are only two ways to effect this viz. either through an increase in Revenue or through a decrease in Expenditure, the government in a sense astutely adopted the less distressing move in their view. While the railway infrastructure is fairly paid for already, the constraints to raising revenue are strong, however. The leadership, perhaps, has little choice in this.
” Differentiating the Services and Differentiating the Price constitute the two most favored business moves/models that the government can lean on.”
Either increase the Seat Capacity (passenger traffic)/ Tonnage Hauled (freight traffic) OR set a higher tariff to either or both. Recall what Lalu Yadav was credited with as UPA’s Railway Minister.
Now that the increase is spelt out clearly, the government in an effort to assuage and limit the discontent of the people needs to focus on “Adding Value”.
Garbage collection cart in the platform of a 2-Tier Railway station.
(a) In business, we usually harp on “Differentiation of Products & Services ” to achieve this end. To cite examples : ” providing new add-on features in electronic gadgets; offering free/discounted cases/covers for mobiles; tweaking the design models as rectangular, curved, oval, oblong … ; offering refrigerators, washing machines .. in different colors; and the like. Translated to railways, this can don the form of improvement of toilets, general facilities for travel, affordable refreshments/food, and any other that people will crave for. While many of these measures have been in the process of implementation earlier too, the
Unsafe toilet in a sleeper coach of a super fast train.
fact remains that people are disillusioned with the status. The government for its part needs to make it ‘all-perceptible’ and ensure a hassle-free travel. This can help minimize the bristles that people are likely to set up against the increase in tariff.
(b) Railways may also adopt a “Differential Pricing Process” selectively for its services and classes within its services. There is already a differentiation in division of trains. A clear structural division in seven categories for consideration here: 1. High Speed Services ( Presently Rajdhani, Shatabdhi, and Duranto ); 2. National Popular Routes; 3. Regional Popular Routes; 4. Metro Rail Services; 5. Inter-city Train Services; 6. Slow Speed Passenger Services; and 7. Local Services.
A view of an ill-maintained toilet in a sleeper coach.
Setting down as defined categories coupled with differential pricing can be profitable to the government and satisfying to the customers. This will enable treatment of the measures to be adopted for each category distinctly different and even unique in one or two cases. It will also help promote healthy competition should future (long-term) plans envisage entry of private or parallel players in this sector.
While much praise has been heaped on Lalu Prasad Yadav, Railway Minister in the UPA government, the nature’s blessing that his period was blessed with, say, economic growth in the region of 8.5 % acted as the trigger to the laudable performance of the railways – a fact that many failed to observe. The present government starts with a distinct disadvantage in this respect. It surely is not its fault either.
Well serving refreshment stall in a 2-Tier Railway station.
Much of what has been attempted before in ‘differentiation’ have not been perceived as satisfactory, comfortable or good fully by the public. To an extent, it will be true to say that it resulted in more discontent, displeasure, and depression than contentedness, pleasure and happiness.
If the present government can even systematize and streamline the already adopted services, it will be a boon cum blessing to the people. This alone can enhance the ‘real experience’ and make everyone happy.
” This will constitute the ‘Value Addition’ in the immediate future ! “
” Dieu avec nous “
Saturday, June 21, 2014 – 11. 59 a.m.
Tidbit : ” Railways ! It would frighten horses; put the owners of public vehicles out of business; break up inns and taverns and be a monopoly generally. ” – Andrew Johnson, 17th President of U.S.A.